The Most Important Home Buying Strategy for Marin County Right Now: Don’t Get Caught In The Mortgage Mess

The  mortgage mess has considerably slowed down sales in the Marin housing market in August. There will be a market report shortly.

We are counseling a number of clients right now on both the buy and sell sides on how to navigate through this. In the long term, this will be seen as a minor blip in the market.

Here is the most important strategy for Buyers right now: we are recommending that buyers negotiate the actual funding of the loan as a contingency in all transactions.

This is a major change from the normal course of business, and may cause some issues, but it is very important. Typically, the approval of the loan, or the removal of the conditions for the loan, will trigger removal of the loan contingency. And in a normal market where lenders approve loans and fund them, it works fine.

The issue now is that because secondary buyers of mortgages aren’t buying them the way they used to, not all loans are funding. Typically a loan funds the day before closing. So the result is that one day before close, there is no money to close the deal, the buyer can’t close, and either must find new funds or is in breach of contract.

There are few good outcomes in this situation. Worst case scenario, you could lose your deposit. Best case, you get extensions, find another lender, and try again - not exactly a low stress procedure either.

There is money out there - one of our clients closed a jumbo loan last week, and homes are selling every single day in Marin.  Qualified buyers can get funding, and remember, every market shift creates opportunity!

This simple strategy will protect your interests, and your peace of mind.

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