Question Post - BK13 Title Company House Sale Complication

[Barbisi]

My husband called the title company and found out that once the discharge and closing occur and the house is under contract, it will take up to eight weeks for the title company to receive the final pay - off amount. This means we will be under contract for a minimum of eight+ weeks instead of the standard four.
My question is: Does this mean that were we to fall out of contract and need to find additional buyers by relisting the house, this process would take eight weeks each and every time, we went under and out of contract even if the full eight weeks had passed and we had already received at least one final pay-off amount, or would the process be quicker the second or third time around?
I realize the bankruptcy will remain on our financial records until at least Feb.2024, but this sounds like an additional hurdle that once we are post-BK13, we shouldn't have to go through.
Are there going to be other roadblocks to us selling this house in 2022?
(My husband posted something similar, but did not ask about the scenario of repeated relistings as I have above.)
Thank you one and all!

[justbroke]

I don't think it should take 8-weeks for a payoff quote once your case is closed. I don't know why there would be any reason that it would take 8 weeks to get a mortgage payoff quote. Maybe the title company is saying that it could be 8-weeks after "discharge" which is totally different from a Chapter 13 closing.

The typical time to close a mortgage is 45-60 days (about 6-8 weeks).

The place to call for the payoff calculation is always the lender. The lender usually requires the request in writing, but some let you use their website. I would wait until about two weeks after your case has closed, to let the dust settle. Even when I was going to do a short sale inside bankruptcy, the lender gave me a payoff within the 7 days required by law (I did it on their website). That was despite the exception for bankruptcy. (They only get more time if the loan is in bankruptcy.)

The only folks that can close a home in under 30 days are those 1.) with all cash closing, 2.) waive the inspection, 3.) are using investor funds (same as cash as they typically bring lots of cash to the table as a downpayment), or 4.) have already done underwriting up-front and the only contingency was appraisal value.

I did a closing on my house in 28 days, but my lender had done all the underwriting up-front and the only contingency was an appraisal for value. They actually called and asked me if I could move up the closing date because it was the end of the quarter and they wanted it in before March 30th! I had substantial reserves in six-figures, income in six-figures, home purchased slightly under value, new home (less than 3 years old), and I had the appraisal done within 4 days after contract. I was to close in 45 days because it was convenient for me, but I had no contingency on sale of my existing home as my lender allowed me to keep both at the same time. The lender just wanted it done!

Bottom line is that a payoff quote for a home not in bankruptcy should be completed in less than 7 days. Now, the title company may say that they need 6-8 weeks to close, but that's a typical timeline overall and not related to the payoff quote.

[Barbisi]

Thank you justbroke for your detailed response!
I trust neither the title company nor the mortgage company - all they want to do is gouge and rook you anyway. LOL
So, we shall see what impediments they throw our way to delay the sale and us getting out of here forever.

[justbroke]

That's the spirit!

[womanonfire]

My husband called the title company and found out that once the discharge and closing occur and the house is under contract, it will take up to eight weeks for the title company to receive the final pay - off amount. This means we will be under contract for a minimum of eight+ weeks instead of the standard four.
My question is: Does this mean that were we to fall out of contract and need to find additional buyers by relisting the house, this process would take eight weeks each and every time, we went under and out of contract even if the full eight weeks had passed and we had already received at least one final pay-off amount, or would the process be quicker the second or third time around?
I realize the bankruptcy will remain on our financial records until at least Feb.2024, but this sounds like an additional hurdle that once we are post-BK13, we shouldn't have to go through.
Are there going to be other roadblocks to us selling this house in 2022?
(My husband posted something similar, but did not ask about the scenario of repeated relistings as I have above.)
Thank you one and all!

Read this and send a Request for Information under 1040.36 of RESPA for the payoff amount. Always use something like Quickbooks to track your mortgage payments. They will steal from you if you allow it and charge you all kind of fees.

You can also ask for a life of loan payment history and life of loan amortization schedule.

https://www.nolo.com/legal-encyclopedia/what-happens-mortgage-servicer-doesnt-send-me-the-payoff-statement-i-requested.html

[Zombie13]

womanonfire - Thank You! I read it, and will follow through if necessary.

[Barbisi]

Thank you womanonfire, we will definitely follow up on this info.

[flashoflight]

A couple of notes.

Payoff quotes take a week or less. Put the date for the quote as far into the future as possible. You might have to get the payoff quote yourself due to the lender's policy. You'll be overpaying the lender when closing early, but the deal will be done. You will have to trust the lender to refund you the correct overpayment amount in about 4-5 weeks after closing. If you don't trust the lender and try to finesse the closing date, well that's going to make it very rough for you if the payoff expires. If you don't like the long delay for that refund check, too bad. You and I know the lender can press a button and know the exact amount your refund should be. But your old lender doesn't care. A refinance is easier because you can lean on a loan officer. Since it's a sale, it's all on you and the title company.

[Zombie13]

flashoflight - thanks for the notes!