We were working with a wonderful young couple anxiously waiting to close on their first home purchase. They, and we, did everything necessary to prepare for closing in a timely and efficient manner. The week before closing, we were told that the sellers were postponing the closing for two weeks. A week later, we were told there would be another closing delay. Even with our very generous and accommodative rate-lock extension fees, the continuous delay was starting to cause more than financial harm to my clients.

At the closing, we finally learned bits and pieces of the circumstances that caused so much hardship. The sellers had multiple liens on the home, including two mortgages, several judgments, back taxes, and IRS garnishments – to name a few. Several of these liens were delinquent, and interest was accruing by the day, which was the primary reason the closing kept getting adjourned.

The deal closed, but the seller lost out considerably. He was forced to sell, which put him at a tremendous disadvantage. In the end, he was required to bring approximately $16,000 to the closing table to sell the house and satisfy all his obligations.

I had another situation recently that reminded me of the above transaction. Although thankfully, in this case, I was able to assist and prevent a loss and hardship. The closing date was approaching for my client, but he still hadn’t given us the necessary confirmation of the funds. He was getting a gift from a family member, but the money wasn’t transferred. My clients were uncomfortable pressuring the family member. However, they understood that we would soon be reaching a point where failure to get the necessary paperwork and confirmations would prevent us from a timely closing.

I offered to reach out to the relative. I suggested that my conversation would focus on whatever I could do to minimize the hassle of the required paperwork. After speaking with the person, I understood that getting documentation wasn’t the issue. The funds were coming from the stock market, and he didn’t want to sell his securities right now at a loss.

“I would be a big loser if I sold my stock right now to give them the gift,” he said. He kept repeating those words over and over. Needless to say, my client was in quite a predicament. Later that week, I had a call with a friend of mine who told me that he was down considerably with his crypto investments. He was thinking of cutting his losses and selling everything he had. I have my opinion on cryptocurrency, but I asked him if he needed the money, and if he thought the crypto market would improve. He believes it will rebound somewhat. I advised, “you’re only a loser if you are forced to sell.” (That said, I also recommended he speak to a financial professional.)

That conversation gave me an idea. I called the relative who was giving the considerable gift. We spoke briefly, and I mentioned that I had some creative ideas that might benefit him and his relative. I suggested that instead of selling the stocks now, we could do a smaller downpayment and either get PMI or a second mortgage. When the market improved, he could sell the stock, and the money could then be used to pay down the loan. He was more than happy to pay a few months of the extra payments so as not to have to liquidate his stocks at a loss. With the right experience and ingenuity, many complications can be avoided.

Special shout out and birthday wishes to Michla Berlin (06/25), Binyamin Bodenheim (06/25), Annekee Brahver-Keely (06/27), Emily Caplan (06/28), Daniel Dearson (06/28), Stephen Gruenebaum (06/25), Elan Nat (06/26), Andrea Nissel (06/23), Lance Parham (06/26), Ben Schmutter (06/23), Chanania Silber (06/27), Aliza Strauss (06/25), Batsheva Wasser (06/25) and Elana Winslow (06/25).

Shmuel Shayowitz (NMLS#19871) is President and Chief Lending Officer at Approved Funding, a privately held local mortgage banker and direct lender. Approved Funding is a mortgage company offering competitive interest rates as well as specialty niche programs on all types of Residential and Commercial properties. Shmuel has over 20 years of industry experience, including licenses and certifications as a certified mortgage underwriter, residential review appraiser, licensed real estate agent, and direct FHA specialized underwriter. He can be reached via email at [email protected].