Question: Our house is sold and we are ready to transfer title and move. We were just told that our pre-approved buyer cannot get loan approval. How can that happen? What can we do?
Answer: A lender pre-approval comes with “conditions.” Loans are not technically approved until all the “conditions” have been satisfied, which may not occur until a day or two before transfer. A lot can happen between the day you sign the contract and the day of title transfer. If loan commitment conditions are not met, the loan will be rejected. Such things as changes in creditworthiness due to newly incurred debt, changes in employment status or income, insufficient funds to close or even appraisal issues may have been the negative factor. Try to find out the exact reason for the rejection. Work with the lender and the agents to see if the purchase can be restructured. There may be other financing options or a different lender that may be able to save your sale.