The Philadelphia Real Estate Blog

I would say that if this happened, someone failed to instruct him properly ahead of time....

Glad that worked out...so many of us, including me, would have probably over-reacted!

Sounds like this buyer wasn't reprsented.  I have never had anything like that happend.  I think you did the right thing.

I'd yell and scream singing ya....friggin.....whooooooooooo, but then I'd say "dude, let me drive down to the bank with you so that I can help you close this transaction.  What a great story to tell.

Christopher, I have to say you have me beat. The most curious situation are divorces. I never know what to expect from sitting in opposite rooms to sitting between the husband and wife.

Thanks for sharing that story with us. Surely, he has more friends that need your assistance. Start asking for 250K referrals

Good comments so far !  It should be noted that the buyer was reminded on the phone as well as reminded several times via email to bring a certified check for the funds. We printed the emails out just in case.

I'd tell them, "Sorry, we used to accept VISA and American Express...but now we only accept a certified check from the bank due to ...."  FOUR HOURS is a long time to wait. :) Glad it went thru!!

Lordy...how did that ever happen?

You kept your cool, didnt point fingers and laughed at the buyers practical joke at the end of things.  I like you :-)

Sounds like the buyer 'punked" you!

In my world, if I represent the seller I would have proof of funds to close from the buyers bank and there would either be wiring instructions in place or no question whatsoever about method of payment.

The situation you describe would give me nightmares so why allow it to happen in the first place?

When I was originating loans, I found out at the closing table the day of a refinance that the home owners put their house into a trust a few days prior to close.  We had to reverse this before funding.

I agree with Karen; as we all should know a check for that amount would have a "hold" placed on it. That it one of the reasons to insure the buyer is educated on what "instruments" pertaining to funds are acceptable at closings.

Wow!  What a day you had!  Glad it worked out for you and the sellers.  I think I would have done the same as you did, but hope I never have to fing out.

Thanks for the post.

I agree with other comments, it sounds like someone failed to give the buyer better instructions.

I think the bigger picture is what do you do when everything else is planned for ?  The buyer was reminded countless times to bring a certified check.  It was not the buyer's first settlement.  Sometimes people just try to push things through anyway.  So even though you might plan for every step of the deal every once in awhile something happens that you have to adjust for.

Obviously, if the buyer was told to bring a personal check or was not reminded several times to bring certified funds, than that would be different.

So would like to hear more about other stories that people have when you have to make that adjustment or split second decision in terms of "what do I do ? "

Good job keeping your cool.  You could have exploded and blown the whole deal.  I had a small lot sale one time that was for all cash.  At the closing the buyer, a bit frumpled looking and not of any appearance of having any means, showed up carrying an ammo box.  When the escrow officer asked him for his funds he handed over the ammo box.  It had $36,000 in cash inside.  They paniced as they had to count it all with witnesses.  It was funny.  he had inherited and when he picked his money up he insisted on cash and kept it that way. 

I agree with Karen - I don't care if the guy is Bill Gates - he still has to come prepared the right way. My settlement "fun" reminds me of when I got a loan done for someone who had a 502 credit score (her husband had like a 480 FICO). They were self-employed too! It was practically rocket science to get them to the table, and they came to settlement IN A BRAND NEW MINIVAN. Unbelievable!!!!

That buyer is in default and they need to know it.  So does their agent, if they have one.  Contract clearly state that closing monies must be by wire or bank checks.

This is nonsense and should never happen.

We don't even permit our buyers to use certified checks because they can be stopped.  Bank checks cannot. 

I had a closing about 8 years ago where the buyer showed up and signed, then NEVER funded the transaction.  It turned out that he had tricked an elderly couple into draining their retirement accounts for the deal, then skipped town.

C&S: That's a real cliff hanger. Went through that this year also but came out ok. I went to the buyer's bank and picked up the check. Great thing about this industry is that it's something different everyday. If you crave routine that can be problematic.

So you think he was just having fun with you to see what you would do?  Clearly you did the right things since it all worked out.

I had clients three years ago that wanted to close with CASH. It was a $200K house and they had moved from out of state after selling their house. Unbeknown to me they were carring their money with them the entire time I was showing in a back pack. When we went to write the contract I told them they needed to place some earnest money down. She opened the back pack and I about fell out.

Our next stop was to a local bank and everything went smoothly from there.

oh, wow.  I was getting nervous there!  I think I would have done just that & asked for them to get a certified check but 4 hours later?  

I have had a similar situation, but the property wasn't $250,000 - it was $48,000 and the buyer had to go to the bank for certified funds.  I had a major commercial transaction in the millions of dollars that the buyer purchased with gemstones.  The settlement was conducted by a gem appraiser and a settlement attorney.  The buyer was short some and rolled down the cuff of his socks and took a few more diamonds, emeralds and rubies out.  Now that was a weird settlement.

What do you do after the buyer arrives at the closing, and smugly produces his certified funds...

1. Throttle him as he walks through to door, allowing his check to float casually to the floor, drenched in his own blood.
2. Keep your cool, allow the closing to be completed, and then throttle him in his chair, until your fingers have lost feeling.
3. Ask the buyer if he'd mind if you used your foot to perform a proctoscopic exam on him.
4. Accept his check, and then follow him to the parking lot, intent on seeing how deep an impression your tire-iron will make on his smarmy little skull.
5. Accept his check, and have MRS. seller keep him occupied, while you and MR. seller go out to the parking lot, and make sure that his brake line develops a slow leak.
6. All of the above in no particular order.

I am, of course, just kiddin.

Well, I think keeping your cool applies to all situations so glad you followed that one but how cocky of the buyer to leave people hanging like that.

As far as what do you do in this case?  The buyer is essential to closing the deal so no buyer, no closing but again, this was completely irresponsible on the buyer's part.  I think this could upset an elderly person to the point where they might need medical attention.  Sheesh, for that matter I might have needed it as well.

Did you ever find out what the hell his problem was and why he decided to frazzle everyone's nerves that like?  Was it a quickie?  Dry martini?  Traffic accident?  Friends from out of town?  I'm dying to know.............

HA HA the buyer did Punk you! The only thing I would have done different is we have the money wired these days to the title company usually the day before the signing... no one wants checks certified or otherwise for that amount. We have a lot of out of state buyers and sellers so it is the best just to wire the funds to the title company and call it a day... but your buyer was a real hoot... no closing gift for him put that towards your health inusrance !!! or a stress test!

At least he had a sense of humor :-) But I feel for you.

I like this! If it hasn't happened to you it will!

Don't shout! Until it's settled then shout long and loud at the buyer's broker!

Don't send the buyer to the bank with this big a check. Send the title company's runner, get the check certified or a wire transfer.

Finsh the closing and explain that title won't record the deed until the check is funded, just like a new mortgage loan.

Back to that personal check. If the bank will not honor it title hasn't transferred so no more harm is done to the seller than had the deal fallen out for any other reason. The seller could take months and lots of legal fees for a spectfic preformace suit or depending on the state he could proceed like any other NSF check. In Nevada that would give the buyer 10 days to make the check good or face a liability of three time the amount of the check. (There are some question to be resolved regarding the sellers delivery of the deed that will need local council, but you have options.

Keep your cool it's just one more hurtal or maybe a pratical joke.

Some times they're not joking! I had a buyer show up with a suit case full of cash and offer it direct to the seller.

If you're in real estate you've got to love people. sorta like watching the monkeys at a zoo.

Bill

Here, attorneys will not accept ANY checks of ANY kind over $5000.00 All monies must be wire transferred.

Hey Guys, I'm in agreement, you did get punked!  But you asked "what would you do".  Soooo.....  I always have buyers provide what is called "Proof of Funds".  I always make it part of the Purchase & Sales in a cash transaction.  Very simply, the buyer has his bank provide the info.  It's just a form done by the bank that states how much is in his account as of what date.

Now, I realize that the buyer can take the money out of the account between the time the bank issues the POF and the closing, but at least it cuts down on a lot of anxiety on your part.  At least you know that they do have the money or did at one time.  Just my .02.  Hope this was helpful.

Good post and story with a good ending. I've not had that happen but I'd like to think I'd think of something to do that would get it closed.

Patricia aulson

An interesting post and fun follow up comments! 

Camilla M. Ferguson
REALTOR®, GRI, SRES, TRC
ST AUGUSTINE REAL ESTATE INC
2692 US 1 South, Suite 204
St. Augustine, FL 32086
"I am here for you!"
904.540.6262
www.CamillaFerguson.com

I love the story about the cash in the backpack!

Keeping your cool typically always wins out.  While the buyer should have known (been informed) that the funds need to be certifiable, there's no reason to go certifiably insane over these kind of hiccups.  They happen.  This case is a prime example.  Glad it worked out.

I had a deal several years ago where the buyer was her own lender. But she didn't tell me that this would be her very first deal. Her very first closing. The closing started at 10am. We weren't finished until after 5pm. I don't know exactly what goes on behind the scenes of the mortgage side of the closing, but apparently she hadn't done much of any of it. Paperwork incomplete and inaccurate, no money anywhere to be found, she didn't know who to call for help.

Another time, the buyer walked into a 4pm Friday afternoon closing with an unsigned certified check. And his bank was all the way across town. Of course, we didn't discover the lack of signature until around 5:15 when all the paperwork was signed.

Lessee... my buyer came to closing with a new married name and no proof of who she was. All the loan documents were in her new name, but her ID was in the old.

Another time, we moved up the date of the closing and forgot to tell the lender. The day before closing arrived... and the lender was caught completely unaware. Ouch. That was my fault.

Holy Moly! This DEFINITELY qualifies...and it smelled like fraud up until the buyer walked in with a certified check!

Did the title company hold the check for 24-48 hours before closing and recording? Just curious, because in our state October 1st they are going to start holding checks for up to 24 hours to prevent against faudulent cashiers checks and certified funds.

I'm wondering why the buyer's agent didn't tell his client that he had to close with certified funds?

Kathy B

I think KEEP YOUR COOL is always the best first step.  That approach opens your mind to investigate other options.  Such as the options pointed out by Alan May. :)

Why wasn't the escrow officer communicating with him and providing instructions on how funds should be deposited, and/or brought in to escrow?

Well, you had me going. Of course I would NEVER have guessed this ending.

I had a couple come off their honeymoon, straight to a closing. Their lender was HORRIBLE, No I didn't refer them.

The walked in with cash, nickles and dimes to make it work.

I had no clue what to do, they had just arrived from Maine and had not opened up an account.

I have had a customer with 45K in a backpack, and wanting to pay for the home, another 650K on his Visa, tied to his brokerage account. By the way if you are dealing with a title company that, takes cash, or money orders, find another tile company. In addition, if the client wants you to deposit the money in your account and give he a check the money is probable counterfeit.

Great story. Have they told you when this episode will be broadcast on Candid Camera?

Way to keep your cool...  My funniest experience with a buyer...albeit stressful at the time...was when she came to the closing table (having been instructed a bazillion times to bring a cashier's check for 44K) with nothing...or so she said.  We got to the part where she was supposed to present her "check" and her reply was..."I don't have no check.  I told my daughter I was not going to bring a check."  I looked at her daughter and she looked at her mother and said, "Mama...I told you that you couldn't get the house unless you brought a check."  So...for 2 hours we all tried to convince, coax, and begged Cornelia to please get a check.  I was exhausted...trying to think (along with all the kind people at the title company) what our next step was. 

I finally looked at Cornelia and said, "Cornelia, honey, we can't close this deal and you can't move into this house unless we give them 44K.  Do you understand that??"  She said, "Yes, I do."  I asked, "So, where is that 44K going to come from?"  She replied matter of factly,  "I have the 44K right here!"  We all look stunned and said..."Why didn't you say that before?"  She replied..."You asked for a check.  I told you...I don't have no check."  I said, "Cornelia, I almost am afraid to ask...but what DO you have?"  She said..."I have cash.  I don't do checks."  At that point she started pulling out hundred dollar bills from her knee high hose, her bra, and her elastic band on her pants.  We were all floored and ecstatic at the same time. 

From there we had to take her to her bank to get all of her "cash" made into a cashiers check.  We closed an hour later.  The entire closing took 4 plus hours.  I yi yi!

As funny as that was...three weeks later I got a call from her daughter saying that they needed to put the house on the market in that they found Cornelia dead that morning.  She had passsed away peacefully in her sleep. 

I guess it pays to use the correct verbage...eh?

This is a great story.  I have actually seen a transaction that closed with a $2,000,000 personal check.  The buyer was a very well know figure though, and I don't think that anyone questioned for a second whether of not the funds were there.

Usually though, I try to make sure that all buyers know that they'll need certified funds ahead of time.

My question is...was the buyer informed up front that they needed to be prepared to have a certified or bank check? Normally I tell my buyers as well as the title companies will usually tell them after seeing and approving the HUD in advance. If they don't then I guess they are going to be in fault and lose their deposit if there is not contingencies. Usually title companies will only take up to $500 in personal checks...they funny part would have been if you told us that they brought a suit case full of cash:)) I hope they weren't that stupid enough not to know that you can't bring that kind of check for that kind of money...who knows how long that check would take to clear.

ALWAYS keep your cool.  Especially with your client.  Kinda wondering, though, why wasn't the buyer told that the money would have to be in certified funds??? 

Not sure anyone would be able to keep their cool, let alone laugh when he did come back! Glad he did though!

Very funny!!! Did you know that some title companies in my area will not accpet cashiers checks anymore for more than $5,000. They must be WIRED funds!!!

Your Buyer was certainly a jokester. I bet he was laughing all the way back to the Title company while ya'll were figuring out what to do.

It is amazing to me how the true personality reveals itself when it is time to part with the money. I like wire transfers , they are much more impersonal.

Wow, I'm not sure what I would do, where was this buyer's agent in all of this?  Did the buyer provide proof of funds with his offer?  I'm glad it worked out for you.

Wow, moments that make us nauseous!! My most interesting closings...when the seller came to the table and was told he needed about 30k (last HUD1 I saw said he was getting $$$ back!!!). I about died! He never batted an eye, excused himself, leaving me and the wife and title rep at the table. He went to the bank, got a certified check and came back in a few minutes. Seems he had borrowed more against the house while we were in escrow!!

But the most irritating closing was the one where the seller sang the blues about how he was down and out, losing money on the transaction, no job, didn't know what he was going to do, could we cut our commission to help him out and make the deal work? We said no, we will just find you another buyer, so he went forward.  After the close, he came in to pick up a check. He couldn't stand it any longer.

"I just have to say this is GREAT!! I just made $50,000 on this house!"

Our commission was about $750 each. We didn't kill him.

I find it amazing that there are comments here asking if the buyer was informed.  Of course he was informed.  The poster clearly states it.  Did you read the whole thing?

Christopher, Four HOURS you waited?  Goodness, that is the worst "joke" I've ever heard.  You have the patience of a saint!

You kept your cool.

We had a closing where on the seller's side the elderly husband came without the wife... because she did not want to sell the house. That's a problem.

We knew to not expect the wife on the buyer's side, my clients, the buyers,  the husband had the wife's POA because she was in the hospital, their baby had come early but he had somehow lost the proceeds check from a closing on their home with another title company earlier in the day.  The buyer's check was found, the seller's wife was found and the property changed hands.  

Larry - I hear you on that one !  On another deal, I have gone to the buyers personally to their bank to escort them while they get certified funds and escort them back.

Frank - So true.  You never know what to expect with divorces sometimes.  Anything goes !

Harry - Great one !  You are right.   We did email the buyer some other properties that night.  LOL

Sonja - LOL, thanks !

Kris - I do the best I can !!!  Thanks for the great comment : )

Crazy stuff happens in this business. Glad you stayed professional. Some joke, huh? I didn't think it was that funny. Usually I'm headed straight from closing to meet with another client for appointments. Glad it worked out...

I would have paniced, picked up the phone to make sure the buyer hadn't left the country and ran as fast as I could to the buyer's bank to make sure the funds were there.  So glad it turned out ok. 

My customer's know from day one of an accepted (executed contract) offer that the cash deal monies need to be wired to the title company at least by the day before closing.

Glad you kept your cool...

I don't think I have any wacky stories to go with that one.  My cash buyers have wired funds.  Glad you kept your cool.

I have never heard of anything like that before.  I can believe the guy didn't read the email.  So many people don't comprehend everything in emails. 

I think I would have crapped my pants- great practical joke though. That sounds like something I'd pull.

I never rely on an email, that is only proof that they have been told the second time. I always make it clear in a phone conversation...backed up by an email.

I had a buyer who tried to write a personal check for a $425,000 condo - We were using the developer's title company and I think they told the buyer to bring certified funds, but maybe not... We all took a break, the buyers  went to a bank and all was well - they came back quickly - thank heavens! Anyway - you are not alone! I had another buyer (I represented the seller on this one) who needed a little extra money at settlement but didn't bring a check so they had to go out to the nearest ATM and get the extra money in cash!

On a cash sale, no matter if I'm the Buyer's Agent or the Listing Agent, I require Proof of Funds -- a copy of their most recent bank statement works well.  I then, ask the Title Company to provide the Buyer's with wiring instructions so they can have their bank wire the funds directly to the Title Company prior to closing.  I verify funds have been received prior to walking into the Title Company for closing. 

Do we have a drum roll....Talk about the test of patience!  Thank God everything turned out for the best!  Congrat's on a closing, you can breath now! lol

Cheron Lange

That is a whacky story. Probably could give everyone involved a heart attack.

Man...  I check my buyers for stuff like that before the closing.  That would make me crazy.  I would stay cool, but on the inside I would be flipping out. 

Glad it worked out.

But I suppose it's escrow's job to make sure funds are cleared to make the deal.

Do you use escrows in Philly or attorneys?

Mostly wires around here, but I did have a title company 'lose' one recently.  It was the wrong wiring instructions, it took them 3 days to find the money, bet their books don't look too good.  :)

Jim - That is a great story regarding the "ammo box"

Steve - That is great !  What are people thinking sometimes ?  I guess they were happy with their brand new minivan as well as the house !  Is amazing a loan went through for both the minivan and the house with those credit scores ! 

Jason - That is scary !  It is a shame that that happens sometimes.  Was that some type of assignee deal ?

Matt - I was jammed up that day and had another settlement to do otherwise I probably would have gone to the bank with the buyer as well !!  Good story with you going in the past : )

Claude - Great story with the funds in a backpack !  I would be very nervous in Philly if I was walking around with that much money in a backpack !!  I can only imagine the looks on peoples faces when they dumped the backpack : ) 

It is a good thing you kept your cool on the phone with this buyer. I know 4 hrs was frustrating but the buyer should have been instructed ahead of time to have a bank check or wired funds.

Okay, I am a pacifist who owns no guns and believes in the Buddhist middle path. however, if a buyer did that type of cruelty as a jole I would become The Incredible Hulk. The buyer is an ass and should be told so.

I'm impressed also with you keeping your cool.

We've had a couple similiar experiences that turned out to be "friendly" buyer jokes, but nothing quite like this.

Good job, and good lesson!