We have received a letter from a local community bank of consequential size advising that all loans in the pipeline heading toward closing will be delayed until each property is inspected by an appraiser. The New York Times has picked up on this new challenge to getting a mortgage in New Jersey.
THE extensive power failures that have paralyzed the region in the wake of Hurricane Sandy have understandably delayed closings in mortgage deals that had otherwise been buttoned up. But lenders are adding to the logistical bottleneck by requiring that properties in affected areas be reinspected for damage.
“If you are in a FEMA-declared disaster area or emergency area,” said Jason Auerbach, a divisional manager for First Choice Loan Services, of Morganville, N.J., “banks are requiring an inspection of the home to affirm whether there was damage done. They are reinspecting properties to make sure it’s still a functional property that can be lived in.”We have had one closing postponed because the borrower disclosed water damage to the property just as the loan was being scheduled to close.
For properties in areas that didn’t suffer extensive storm damage, the inspection may constitute no more than a drive-by. The delay in such cases may be no more than a few days.
Both buyer and seller may also be required to sign a form attesting that they agree the property suffered no storm-related damage. Regardless, buyers should do a thorough walk-through well before the day of closing, advises Scott Penner, a real estate lawyer in Milford, Conn.If you are advised of a delay by your new lender, be sure to discuss the effect of the delay on your interest rate!
Read the full story here.
For your next title order or
if you have questions about what you see here, contact
Stephen M. Flatow, Esq.
Vested Land Services LLC
165 Passaic Avenue, Suite 101
Fairfield, NJ 07004
Tel 973-808-6130 - Fax 973-227-0645
E-mail sflatow AT vested.com
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