Big Bear Property
Certain Big Bear property purchases can be a bit tricky. One of the major differences between purchasing Big Bear property that is bank-owned and a traditional listing, is the matter of the per diem many banks charge if an escrow goes over the time period. Per Diems can range from $50.00 a day, all the way up to $500.00 or even more. In effect, the Per Diem is used as a punishment if the buyer cannot perform and close the escrow on time. In many cases, if the bank is sensible, the per diem is usually waived as long as the buyer is doing everything in their power to close as soon as possible. This is not always the case.
Recently, for the first time in my experience with Big Bear property, I saw a the Per Diem used as punishment and in an aggressive, hurtful manner. During the appraisal process, the appraiser called out the water heater for not being in a closet, and not up to code. Before the bank would fund the loan, they needed the water heater to be brought up to code. This required the water heater to be strapped and a closet built around it. The listing agent and I had to coordinate and get bids, and then, when the bid and work were approved, get the work done. It took about a week to get all of this accomplished. Then the bank had to order a reinspect on the property. This put us about a week behind on our timeline. Keep in mind, my clients had done everything they were supposed to do in a timely and correct fashion. It was not their fault that the water heater was illegal and the house would not qualify for a loan until it was repaired. So, I asked for a week long extension to give us time to finish the loan process and close on the house. Unbelievably, the asset manager for the bank refused to give us an extension. She said " Since it was your appraiser who called out the water heater, you will have to pay us the $150.00 a day per diem until it closes." I was dumbfounded. The water heater was illegal and any appraiser in the world would have called it out. She then told us if we tried to back out, she would keep our $3,000.00 deposit and we could sue her to get it back. In the end, my clients ended up having to pay the bank an extra $800.00 because of the delay. But this is not exclusive to Big Bear property purchases. I hear of these shenanigans all over the country nowadays.
This was the first time I have ever had clients have to pay a per diem on a Big Bear property. Big Bear properties are usually not poisoned with this kind of ridiculousness. As a matter of fact, I have had a bank forgive a client $3,000.00 in per diems because of difficulties regarding his loan. The point the whole situation drives home is, the bank see's your whole team as one entity. If you are late because your lender has issues, it is your fault. If your Realtor drops the ball on getting required paperwork, it is seen as your fault. If anything happens, for any reason, on your side, you can be held responsible. One way to combat this is, if you or your Realtor or lender think there could be any kind of delay, ask for a longer escrow period. An extra 10 to 15 days could end up saving you thousands of dollars if something unforeseen occurs.
It is always better to know what could happen when buying a Big Bear, CA property beforehand so that you can prepare and overcome.
If you have any questions about Big Bear property or if you are interested in owning a Big Bear rental property as an investment, please feel free to call me at (909) 587-5605.
