There are a surprising amount of Toronto residents who are feeling the pain of the 2017 spring market frenzy. Those who feel they overpaid for a property are looking for options when their home appraises for less. Here is how to renegotiate your agreement and save your new home.
Toronto Buyer Looking To Renegotiate
To clarify, we are not going to address retooling the Purchase Agreement from a Realtor’s point of view but how to make sure we can fill in the gap while home prices are recovering from the government’s new home price cooling measures. So you are on the hook for a home you overpaid for at the time of closing. First of all take a deep breath… There is a lot of potential shame and embarrassment that comes along with this however as long as this is your primary shelter and you are looking to live there for the next 5 to 10 years then any potential over payment should be mitigated with time. Now that we are thinking clearly, here is what we need to do to get you the financing you need to close on the home.
Too Much Home, Too Little Money
It has been explained to you by your Real Estate Lawyer or your banker that you are short on the money needed to purchase the home and will have to come up with an extra 50 – 100K in order to close. Your home was worth 1M back in April and you received an approval for 800K or 80% loan to value. Today the home has appraised for 925K and the bank will only provide you with 740K of this or 60K less than your finances allowed. So how does this amount of money appear out of thin air? It doesn’t however there are lenders who are willing to take the risk of providing short term 2nd mortgage funds in order to assist you in getting this money and keeping you from losing your security deposit to an already perturbed seller.
Secondary Financing To The Rescue
The process becomes a simple and straightforward mortgage approval without disturbing your existing bank financing. The new funds are forwarded to your lawyer’s trust account in a couple of days and the nightmare can finally end. This can be a great solution to those in anguish over have a home purchase dream become a groundhog day experience of stress. There is nothing to lose by exploring this option and you will potentially keep the costs of legals and losing your security deposit placed on the home you were going to buy.
Reach out to me for a quick and complimentary assessment of your situation and we can determine in short order how to renegotiate a successful closing.