Dear George: "My husband and I are in the final stages of closing a home. The mortgage broker just told us our actual closings costs will be $1,558 more than what was stated on our Good Faith Estimate. Furthermore, on our mortgage broker's advice we increased the sales price to cover the seller's paying for certain closing costs. We now believe the seller has no intention of paying those closing costs. Do you have any advice for us?" -- Burned

Dear Burned: Communicate with your mortgage broker. Be specific about your concerns. Are the seller's obligations to pay closing costs set down in writing? If you are not completely satisfied, communicate with the closer at the title Company. Should you wish to file a complaint against the mortgage broker, contact state regulators.

Dear George: "My wife and I purchased a home earlier this year. As an addendum at closing we agreed to allow the sellers to remain in the home for a specified number of months.

At the time it was a good arrangement for both parties. In the addendum, the sellers agreed to pay an amount that would cover our mortgage plus the local association fee. They also verbally agreed to give us 30 days notice before they vacated the premises. We've been keeping in regular contact with the sellers via e-mail.

However, just recently, they are not replying to e-mails. Only a few weeks remain until they are supposed to vacate. Is there any way I can force them to leave on the expiration date? Or, do I need to give them advance notice of intent to take possession by a specific date?" -- Fleeced in Florida

Dear Fleeced: First, save all your e-mail communications. Also, save the documents dealing with your closing. That includes not only your actual closing documents, but also any written communications dealing with the transaction. You will most likely require the services of a local attorney in Florida. Check with your employer to determine if it can recommend one. Or, access the State Bar of Florida. The association's "Lawyer Referral Service" provides contact information to local attorneys who will provide a 30-minute consultation for no more than $25.

Dear George: "I'm selling a home in Missouri. The buyers signed a sales agreement and gave me $500 earnest money. Their mortgage loan officer personally inspected the home prior to the buyers' signing the purchase agreement. The loan officer assured them there would be no problem financing my asking price.

On the final day, the loan officer informed us that there had been a mix up with the appraisal. The wrong appraisal had been sent to the underwriter. The loan was turned down. The actual appraisal was done 3 weeks earlier (asking price $30k, appraisal $40k). There was plenty of time to catch the error. The buyers have excellent credit. The buyers are great people. I would hate to keep their money. But, if the financial institution can be held liable I would not hesitate. Can the buyers recoup their earnest money from the lender for mishandling the loan if I keep it?" -- Miffed in Missouri

Dear Miffed: As a real estate broker my business experience tells me that filing a lawsuit against a financial institution (or mortgage broker) can be a lengthy, costly proposition. Haven't you both sustained "damages" due to the lender's sloppy handling of this transaction, even if you return the earnest money to the buyers? What does the sale agreement say? If the buyer made a good faith effort to obtain financing can you keep the deposit or must it be returned? Speak with a Missouri attorney, and also see if state regulators can assist -- they may have a great interest in hearing the lender's version of events.

Dear George: "A friend of mine recently purchased a new construction model home. He is a first-time homebuyer. The builder agreed to pay $5,500 toward closing costs. The sale closed the first week of August. My friend was charged with the property taxes for the period from January 1 through the closing date. Those taxes were taken out of the closing costs the builder had agreed to pay. However, because of circumstances beyond my friend's control he did not have a choice. He had to close the transaction that day. I am curious as to whether or not he should pursue this tax issue or if you feel that it is something he should have paid." -- Curious Friend

Dear Curious : It is possible that your friend may have been charged the property taxes for a period during which he did not own the property. If that occurred, then I agree with you. It was wrong. However, the HUD-1 Settlement Statement can be confusing, especially to a first time homebuyer. Your friend should contact the Title Company that handled the closing. Ask the Closer if he or she would mind going through the property tax charges again. If there is an error in the closing process which cannot otherwise be resolved, check with the title insurance company to see if any coverage applies.

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George Stephens welcomes your questions by e-mail. Because of the volume of mail received, questions cannot be answered individually. Mr. Stephens is not a lawyer and this column does not contain legal advice. If you wish to obtain legal advice, please consult with an attorney or legal clinic.

Published: November 30, 2001

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