I see files on which Realtors have done a great job for their clients. From time to time I will pass these on to you. (I will change the names to protect the innocent!)
“June” was recently asked to list a property. She contacted the mortgage company to confirm the balance due on her clients’ mortgage. The mortgage company gave June the balance which included a penalty of over $9,000.00. June thought this looked too large in light of the rate her clients were paying and the balance of the term. She asked the clients for their mortgage documents, checked them and saw that the penalty didn’t seem to make much sense.
June pressed the bank for an explanation. She had to call the bank several times before the bank provided the basis of its calculation of the payout penalty. When June reviewed that against the clients” documents it was clear that the bank was overcharging.
After much resistance, the bank backed off, agreed the realtor was right, and reduced the penalty by $6,400.00.
The clients love June for what she did for them!
Payout penalties amount to an enormous amount of money for financial institutions. They can be complicated. I wonder how often people are overcharged?
Once a deal is signed, everyone is under the gun to close the deal. So its best to take a look at payout penalties at the outset of a listing, as was done here.