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How recent changes in the Las Vegas Residential Purchase Agreement or RPA affect buyers who need to finance a mortgage
Greater Las Vegas home, condo or high rise condo buyers who need to finance a mortgage are now facing appraisal and mortgage deadlines due to recent changes in the Las Vegas Residential Purchase Agreement or RPA.
Up to October 2016 buyers who wanted to finance their mortgage did not face any deadlines to finalize and fund their mortgage loans until a few days before the contract expiration. If the mortgage was not ready, they would go to the seller and try to get an extension to the contract. If problems persisted, they obtained a rejection from the bank and canceled the deal while getting their earnest money deposit back. The home seller wasted a long time and ended up with nothing.
This is no longer true and the latest changes to the Greater Las Vegas Residential Purchase Agreement (RPA) require the buyer to give the seller a deadline to provide appraisals and to finalize the mortgage loan. Failure to meet these deadlines will result in the loss of earnest money deposit (EMD) if the buyer doesn’t renegotiate or cancel the deal before the deadline.
This is the appraisal contingency clause in the Las Vegas residential purchase agreement
As you can see in this appraisal contingency, buyers are required to set a deadline for the probability that the appraisal comes below purchase price. However, the buyer has to have an appraisal, to begin with in order to see whether or not the appraisal is or isn’t lower than the offer price.
This is the loan contingency clause in the Las Vegas residential purchase agreement
“Buyer shall remove the loan contingency in writing, attempt to renegotiate, or cancel the RPA by providing written the notice to the Seller no later than __a certain number of ____calendar days after Acceptance of the RPA; whereupon the EMD shall be released to the Buyer without the requirement of written authorization from Seller. IF this Residential Purchase Agreement is not canceled, in writing on or before the Loan Contingency Deadline, Buyer shall be deemed to have waived the Loan Contingency.”
Now a buyer or their real estate agent, who has no control over the mortgage process, have to set deadlines that depend on an underwriter who answers to no one. This makes for big complications, for example, it takes 8-10 days to get an appraisal for a VA loan, but if things go wrong no one is allowed to even contact them for 15 days. A bad solution is to be conservative and set longer periods to obtain the appraisal and finalizing the mortgage, except that sellers do not look kindly on this and could accept a contract with a shorter deadline.
Our solution is much better and it is getting under-written approved before making offers on a Las Vegas home for sale, condo or high rise condo. We will discuss this and much more in the next video called Mortgage Guide for Las Vegas homes, condos and high-rise buyers.
If you want to buy, sell or invest in Las Vegas homes, condo, town home or high rise condominiums please call us at 800-762-4917 or e-mail us. You can find our contact info below the video.
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On behalf of the Saber Team, this is Karen Saberzadeh of Realty One Group and www.lasvegas4us.com wishing you a great day.