Step 9:

Extensions and Cancelations

 

Extensions

In the event a buyer wishes to cancel the contract after the contract has been executed, they must submit a signed Cancellation Request form to the specific Asset Manager along with supporting documentation. 

 

Asset Manager's Closing Department will review the cancellation form and supporting documentation to determine whether the case qualifies for a refund of the earnest money deposit. 

 

All contracts are canceled in accordance with the Earnest Money Forfeiture and/or Return outlined within the Notice to Purchaser Agreement. 

 

The asset manager will be responsible for accepting all extension forms and fees – not the BSCA closing agent. 

 

Extension Form

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The selling agent must submit the Extension Request Form and fee directly to property specific Asset Manager. 

 

Extension fee checks should be made payable to HUD. 

 

Asset Manager(s), as HUD’s Representative, may grant an extension of closing time in increments of 15 days. 

 

EXTENSIONS:  If an extension is required, the purchaser’s real estate broker will need to submit to Asset Manager (5) day prior to the expiration of the sales contract

 

Sales Contract Extension Fees are sent to the Property Specific Asset Manager

 

Extension fees must be in the form of: 

 

Certified funds and made payable to HUD 

Please include the Buyer's First and Last Name, FHA number and Property Address on the check. 

Wire transfers will not be accepted 

 

Under no circumstances will an extension fee be waived when the delay is caused by the BSCA. 

 

 

Buyer Select Extension Process:

 

EXTENSIONS:  If an extension is required, the purchaser’s real estate broker will need to submit to Asset Manager (5) day prior to the expiration of the sales contract

 

(1) Closing extension request form, (attached)

(2) Documentation supporting the delay,

(3) Extension fee of $375.00, PAYABLE TO HUD.  Please include the Buyer's First and Last Name, FHA number and Property Address on the check. Must be certified funds.

 

Closing Date Extension Policy

 

Buyer Select Closing Agent Areas

 

If closing date stipulated in the contract cannot be met, purchasers may request an extension of the

closing. Extensions of time to close the sale are at the Seller’s discretion and, if granted, will be under the

following guidelines:

 

1. The request for extension of closing time will be made in writing to the Designated HUD Asset

Manager for processing. The request must include the cause of delay and that necessary mortgage

funding has been obtained or is imminent. A signed and dated lender letter should be received by

HUD’s Designated Asset Manager prior to expiration of the sales contract.

 

2. Extensions will be granted for a 15 calendar day period. The following are the extension fees due to

HUD’s Designated Asset Manager at the time of submission of extension request. These fees must

accompany the extension request and be a non-refundable certified or cashier’s check or money

order in the full amount of the 15 day extension.

 

This fee is based on the Contract Sales Price: Must be CERTIFIED FUNDS

 

Contract Sales Price of $25,000 or less Extension Fee is $10 per day

Contract Sales Price of $25,001 to $50,000 Extension Fee is $15 per day

Contract Sales Price over $50,000 Extension Fee is $25 per day

 

3. At the time of closing, the unused extension fees, if any, will be prorated to the Purchaser

 

4. The granting of an initial extension period does not obligate Seller to grant additional extensions.

 

5. Extension fees will be retained by Seller if a closing does not occur.

 

Will Extension Fees be waived if at no fault to the buyer?

 

Each Extension Request is reviewed and approved by the Specific Asset Manager.

 

It is the discretion of each asset manager to waive or not waive the extension fee based on the specific circumstances of the request.

 

 

Under no circumstances will an extension fee be waived when the delay is caused by the BSCA.

 

 

Cancelations

 

The following provisions are applicable in all instances except those where HUD is unable or unwilling to close the sale, in which case the entire amount will be returned.

 

Investor Purchasers:

• Uninsured Sales: 100% of the deposit will be forfeited to HUD for failure to close, regardless of the reason.

• Insured Sales:

  • 50% of the deposit will be forfeited to HUD for failure to close if the purchaser is determined by HUD to be an unacceptable buyer.

  • 100% of the deposit will be forfeited to HUD if the sale fails to close for any other reason.

 

Owner-Occupant Purchasers:

• Return 100% of the deposit when:

  • There has been a death in the immediate family (purchaser, spouse or children living in the same household).

  • There has been a recent serious illness in the immediate family that has resulted in significant medical expenses or substantial loss of income, thus adversely, affecting the purchaser's financial ability to close the sale.

  • There has been a loss of job by one of the primary breadwinners, or a substantial loss of income through no fault of the purchaser.

  • For an FHA insured sale, HUD (or a D.E. underwriter) determines that the purchaser is not an acceptable borrower.  For an uninsured sale, the purchaser was pre-approved for mortgage financing in an appropriate amount by a recognized lender and, despite good faith efforts, is unable to obtain mortgage financing.  "Pre-approved" means a commitment has been obtained from a recognized mortgage lender for mortgage financing in a specified dollar amount sufficient to purchase the property.

  • There is other equally good cause, as determined by Ofori, in keeping with the spirit and intent of the above policy.

• Return 50% of the deposit when:

• For an uninsured sale, despite good faith efforts by the purchaser, there is an inability to obtain a mortgage loan from a recognized mortgage lender.

 

• Forfeit 100% of the deposit when:

  • No documentation is submitted.

  • Documentation fails to provide an acceptable cause for the buyer's failure to close. 

  • Documentation is not provided within a reasonable time following contract cancellation.

 

Vacant Lot Sales:

The purchaser is considered to be an investor and instructions pertaining to investors will apply.

 

HUD Contract Cancelation Forms

 

Cancelation Form

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Step 10.

Success! Walk Thru then Closing