Perils of new home buying
 

We're down here now looking to purchase a discount new home in The Villages. We signed the agreement on Wed and closing is scheduled for Jan 7. We thought we'd like to interest rate shop and checked with a couple of banks and they were unable to close so quickly. It seems the closing window is so short deliberately to funnel activity to the Family bank, Citizens. That's disappointing, but more than that I'm concerned Citizens could fail to close on time (I recall reading a scare story right here before). The contract says if you fail to close on time you lose the discount (11K in this case) and pay Citizen prime rate +1 1/2% plus $250.00. That's bolded in the contract also. Just curious, has anyone had, or heard, of issues? Anyone actually run over? I understand the 30 days is standard, but it seems particularly tight with the holidays.

You are the buyer. You are the person to decide when you want to close on the house. You are the one giving a lot of money to the seller. That puts YOU in the driver's seat. You should have used some of that leverage before agreeing in writing to the terms of the seller.

Forget about what the Villages Realty said about a "discounted" new home will not last. They are not selling as fast a the Villages Realty makes you believe - buy you already signed a binding contract.

Citizens First is a top-notch bank. If your credit score is good, you will have no trouble in making that closing date.

After 1 month of paying a mortgage, you can then pay off your mortgage in full and own the home outright. It does take one mortgage payment before you can do that.

We received a contract on our home in N.Va. in August of this year. Agent said this is a good contract, but going VA for the buyer takes time, should be no problem and he had put down a sizable amount on our home.
We immediately took off for the Villages and were taken around by one of their agents looking at new homes.
We mentioned that we tried to move down 4 yrs ago but home wouldnt sell, and we put down a $1500 deposit, which we eventually lost after a good while.
We found our perfect new home, the agent said we would have to put $40,000 down on it and if not settled in 30 days with balance we would lose it.
We said whoaaa, no way I would take a chance like that, anything could kick out.
We started looking at re-sales and eventually bought one in September, paying cash for it which in which we were going to do with the new one.
$40,000 is one big risk.

:22yikes: Sounds like you made the right choice, especially given that your home in VA hadn't closed at that point. I never knew TV was putting terms like that on the new homes.

Bill

I've been to TV on four occasions, two just looking and the last two buying. What I was told was always consistant with the times before. We tried to purchase a resale in September. When buying a resale the terms of the deposit and the closing dates are agreed upon by the buyer and seller. We agreed on 10% down, 45 day close. Citizens managed to screw the closing up and even a week later could not give me a definitive closing date. So I backed out and got my deposit back. I returned two weeks ago and decided to buy new. In that case TV controls the deposit amount and closing date. 20% deposit was due within a week and it was a 30 day close. Take it or leave it. I wanted to use another lender but knew the 30 day close might be a problem and I could not take the risk. For some dealing with TV is a whole different ballgame than what they might be used too, one has to realize TV is in control.

I don't think I am getting this right......
 

Wait now. Am I understanding that you would lose your down payment on a new home of 40K if you didn't close in 30 days....................???????????????


We paid cash so financing wasn't part of the deal, but I have never heard you would lose your earnest money.....

I had heard that you can change your mind if your deposit is on ground and choose another location and even wait a year or two.

I seem to recall a few years ago it was $20K down at risk.



.

Thanks for your thoughts everyone. We met with the Citizens rep this afternoon. It was like kicking the can down the road, they're trying to keep us moving forward. But it was, as expected, more "just trust us". We're from NY and, fortunately, we have a 7 day rescission window. So we have control for a couple more days. The Citizen's rep could do no more than anyone else - gave us "no problem" just trust us. It's so unreasonable, I feel it's simple enough just to add a one liner that we will not be penalized if closing is delayed through no fault of ours. If someone else fails in their job we get penalized. So unreasonable. When you said The Family has control you're so right. I'd add they're very greedy. They should be able to provide the best loan rates around, given they're profiting from the sale (probably the appraisal, inspection, and everything else). I can't be sure but it appears to me they maintain they're cost a cut above the others. We're not done yet, we really want to make it work but it's all one-sided. They don't need us and they don't really care. If it works it'll be because we caved.

That is...
 

That is... scary.
JJ

We bought a resale, so the terms they "demand" are new to me too. Did they at least tell you what the interest rate would be before you signed? If not, and you still have time to get out of the contract, frankly I think I would. Resales are sounding better all the time!

Personally, I think resales are a lot better deal than a new house. Negotiate on price with the seller, set your terms, no construction going on in the neighborhood, mature landscaping, you get to see actual fees and bills the owner has paid, bond will be a heck of a lot lower than in a new house.

The bond payment is attached to your property tax bill each year. Mine was substantially less than several friends who had bought new homes.

wishing u well finding the home u want, i suggest buying a used home at a great discounted price, then, see for your self how the homes are built and do as many walk threws as u can, decide to buld your home a year later and watch your home getting built, or just rent a home untill your home is compleat. keep the bulder on his toes, and inspect your home with a fine tooth comb. best wishes and Merry Christmas....

Hal

I know someone who actualy closed "early" on a Village New house ...early by 3 days and had to pay the additional $250. House was done and buyer wanted and needed to get in the house. The $250 charge was not necessarily a penalty but a charge for making scheduling changes not only with the bank (Citizens) but also with the builders rep for walk throughs etc.

Sparky-30

Im with Gracie on this one regarding the loss of a down payment on new construction. YES TV will default you if you change your mind for whatever reason and dont complete the purchase on a new home after you made an initial contract downpayment..........BUT in the past if you came back to TV and executed another contract for a new house, TV gave you credit for the Downpayment you defaulted on the earlier contract....if they were made are of it. Now things may have changed or TV may have imposed a time period where this offer is available.

It would be interesting to know if something like this regarding the downpayment being recredited after you cancel an inital contract still exists...and if so for how long is the offer valid?

Yes, they quoted the rate and we can lock-in today at 5%. Bank of America was 4.62% and that would be $50/mo savings. But BofA said there's no way they can meet the closing date, especially now (holidays). At this point, I'd be afraid to go with anyone but Citizens since the contract penalties. are so harsh. That's the way they want it. We can still get out of the contract. If we do, we'll be looking at pre-owned. We really want to be here. We like new build and we'll probably look for nearly new. We're going to try one more time to get some kind of exception from penalties in the event someone else fails in their responsibility, but I'm not hopeful.

It's almost comical. The contract says if missing the closing date is caused by the seller they're responsible for actual incurred cost for lodging, one meal a day, and furniture storage. On the other hand if closing is delayed and not caused by the seller, the buyer will pay the seller for water, sewer, electrical, lawn and landscape, monthly amenity fees, interest on remaining balance (prime +1 1/12%), $250, and any Discount will be added back into Purchase price. Note that buyer accepts responsibility for any and all delays not caused by seller, that means Bank failures, delays in inspections, the appraiser gets hit by a beer truck, sudden surprise hurricane, or a stray meteor hits the Sales Center. It's hard to believe they demand we accept responsibility for the promptness of all their organizations. But that's the way it is.

We were told that the initial $2500 could be re-applied if we backed out now (moot point because, as New Yorkers, we actually can rescind with prompt refund). I think re-applying amounts applies to the remainder of the 20%, due in 7 days, also but I'm not certain they actually said that. Interestingly, I don't believe there is any mention of it in the contract. It's another "trust us" provision.

Being from New York we got a spiral binder (probably a couple hundred pages) that spells out the requirements. Seven day rescission period, rather than 3 days. As I read it, all monies (deposit, down payment, etc) must be put in escrow at Bank of America branch, N 14th St, Leesburg. If we don't receive notification of that deposit within 15 days we can cancel the purchase agreement. In the event of any dispute the Attorney General of NY will determine distribution of the escrow funds. They laughed at the NY bureaucracy but I think I like it. I guess we do things differently in New York.

And that is the way it will remain if people put up with it. If it were me, I think I'd walk while I could. The $50 a month difference in interest alone makes it a raw deal. If you have good credit at all, you could probably get better than 5 percent interest almost anywhere right now!* And you wouldn't be risking a huge loss if the appraiser gets hit by a beer truck. Resales are looking better all the time. Sorry to say this.

* Assuming apples-to-apples comparison. Surely Citizens isn't charging you any discount/closing points at 5% interest! If they are, it sounds like an absurdly uncompetitive interest rate! Did they estimate closing costs??

4 yrs ago they would work with you on a new home, but its vicious now, its 20% down immediately and close within 30 days or ............finger across the throat! When the sales rep told me that I liked to fell over, no one in their right mine would take a chance on something like that. I thought they would take a few thousand down in good faith to hold it until I closed, ...no way, their way or the highway.

Economics 101 - it's your Money! If you don't like the deal, terms, conditions, or whatever, take YOUR MONEY and go spend it with someone else. If you signed without reading the terms, you may be stuck and that is your fault - no one else. I agree with many in here who say resales are a better bargain.

Is Citizens charging higher interest on new homes? I just closed on a resale and it was 4.5%. I could have gotten 4.0% from them except this is a rental property so had to pay the extra .5%. I closed in 30 days, but that was my choice, not a requirement. I also checked other banks and Citizens was a 1/4 % higher, but so far have been very happy with their service so stayed with them.

When we bought our home a few years ago, Citizens was about 1/2% higher than other banks. We went with another bank. We planned on paying off our mortgage within a couple years anyways, but if you hold the mortgage to a 30 year term, for example, that's an extra $18,000 added to the cost of your home if you're paying $50/month more. All I can say is, there are a lot of nice pre-owneds around, truly!

T-bug I agree
 

plus owner upgrades!

I will give you another example of a resale listing by TV that our friend made an offer on and had a signed contract. There was a concern if the house was priced too high and the buyer was going to use a bank other than Citizens. Again the RE agents...both buyer and sellers were from TV. Closing was to be in 4 weeks. ASking price was $210....contract price agreed to was $205. At 3 weeks 3 days all was done with inspections paperwork etc, EXCEPT the appriasal from the bank did not come in. Finally 2 days before closing the bank comes in at $200K and wants the buyer to come up with more money or the seller to lower the price.

Since this listing was through TV, I can almost guarantee you that the appraisl would have come in betwween $205-and 210K. My friend ended up walking BUT the story does not end there. The Seller RE agent tried to stop my freind from cancelling the contract stating the appraisal was not done by a "Sumter County Appraiser". Finally after going directly to the Sellers broker my friend got her money back and moved on......BUT this is an example of where suing Citizens may have been more expedious but certainly not in the best interest of the buyer. Now this house was modestly priced but what would have happened if you were in the $400-500 range!!

I've been shopping interest rates and closing costs too. Citizens is very high in comparison. We purchased a lot in July 2010 and have until July 2011 to begin building. Our home will go on the market next month and hopefully it will sale quickly. I just resent being held captive by Citizens and The Villages, but I want to live in The Villages. My solution is to pay cash or bite the bullet and pay the fees.

Hope to see you all next year. Happy Holidays!!!:a040:

Reading this thread was a mirror of our experience.

We had heard from friends who lived there and others that this was Disneyland for seniors etc.
When we came down in mid August to look ( I did not know my wife was coming to buy) the life style hooked us. This is our fifth house and all but the first were new. Needless to say we never got to the preowned homes even though in hind sight they look like the better value.

On the third day we purchased a home in Pennecamp and were on an emotional high when we came in the sales office to sign the contract.
When they said that we would close on Sept 17th and could do it by mail we
almost fell off our chairs. Never had we closed in 30 days and by mail.
I told them we had a cruise in mid Sept and there was no way that the documents would be signed on a ship.
They said don't worry that they would get the documents to us several days before the ship left.
In the end they gave us an extension till 9/22 and the paper work did not get to our house till 9/20 a day after returned.

They are a well oiled machine when it comes to closing.

In the end it was good because my wife tells me I need a push once in awhile,
but not a tornado.

Fortunately we have sold our house and close 12/17. We hope to be in Pennecamp a few days before Christmas.

In retrospect, if you had told me 6 months ago that would buy a new house, sell my own and be in Florida before Christmas I would have said you are nuts.

Thanks for reading if you got this far.

Pre-owned here we come.........
 

Well, we're done. We asked for a simple one-liner exempting us from penalty for 15 days after the closing day in the event someone else causes a delay. No go. The really problem was no one at our level has any authority. The folks at the Sales office can do nothing. It's all at the corporate level and "the family". I went into this with rose-colored glasses, expecting a wonderful experience. Needless to say, I've lost all trust and respect for The Villages organization.

There's a couple of articles in the today's paper on Bernie Madoff and his son's suicide. There's a guy that had all the wealth and power anyone could want and he continued to deceive and cheat. My wife asked how he must feel in prison now. No different, I suspect. I only think of one word - evil. Unhappily, that's my new view of the family now. I apologize for the strong language, it's just my perspective. I could just say it's greed but that's not strong enough for me. I don't ever recall being so disappointed.

Hal, don't give up. As you stated, "Resales, here we come!". That definitely gives you more latitude to do things on YOUR schedule rather than 100% on someone else's.

Sandy and I had always thought we'd buy new......someday......in TV. But we stumbled across an extremely nice resale that fit all the criteria we had so we decided to pull the trigger. We agreed with the sellers about what organization we wanted to have handle the closing which has been great. And we picked our own closing date to coincide with the dates that the closing entity had available. Also, it's a FSBO which leaves the essence of what's agreed upon simply between us and the sellers. The law firm handling the closing put the sales contract together for us and is handling the transaction just like they would any other sale.

With a resale, though, what you see is what you get - no even minor amount of customization, etc. like you can do with a new build. But we feel we're getting a lot for our money - the upgrades that the sellers had already put in to the house, lower bond than what a new build would be......and we're buying it furnished which will be great since it'll serve as our "home away from home" for a while til Sandy retires. All for less than what an equivalent new build would be right now.

Resales aren't for everyone but they're certainly a viable consideration!

Bill

Hal - sorry to hear you had such a bad experience. Our previous neighbors had something similar happen, but they wanted to be here bad enough that they were able to work it out. Good luck with finding the pre-owned you're looking for. There sure are plenty of them out there, so I'm sure you'll find what you're looking for. Again, I'm sorry you had such a bad experience.

Good luck on your pre-owned home search.

I see there are 564 pre-owned on TV site. Add in the MLS and FSBO's and you should have a BIG selection.

Great selection and great time to buy. Hal, all will work out well in the end. There's still no place like home in The Villages! All best wishes, and please keep us posted on your progress.

Hal, like the others have said, I still believe you would love The Villages. Go to an "outside Realty company" and they will show you the wonderful resales available through Multiple Listing Service. Work with the seller on negotiating a price and a settlement date that suits you. If you are more comfortable with Bank of America, go with them.

I used ERA Tom Grizzard agency on Hwy 441 in Lady Lake and found a perfect home. I bought in mid-2010 and asked for settlement in 45 days. Settlement was a breeze and I used Citizens First but any bank would have been just as good.

It is a good life here.

We just closed Dec. 6th and interest through Citizens was 4.375. My understanding is that interest rate is related to your credit score. There were no points involved. It was a 30 day closing.

Interest rates have jumped up the past two weeks.

Congrats, I think you got about the best all time rate. We were here the 1st week of Oct and went through the pre-approval process. The rate a 4.62 at that time. You lock-in around Nov 7, rates have went back up recently. I'm hoping they drop back ad I get another shot. If it keeps moving up, we'll be cash customers. I really wanted to lock-in the low rate to cover taxable IRA withdrawals.

You're right, credit score is an important factor. That wasn't our problem, score was 800+.

I wanted to end this thread, enough already. But I keep getting OMG revelations. I wanted to share one last post with you all. I've had free time to surf and I'm surprised I hadn't seen the IRA vs The Villages issue before. I assume most of you are familiar. Reading how the Developer mishandled your money and lined his pockets for hundreds of millions (tax-free) really shocks me. Given what I've been through I really shouldn't be surprised.

The POA site mentions the issue and says that residence don't get a vote. That was an Ah-ha moment. The purchase agreement spells out specifically that it's an "Amenity fee" and there's no Home Owners Association. With an HOA, residence would have a say.

Oh well, we're leaving tomorrow and I'll leave on a positive note. I got a call tonight from our sales rep. We can pick up a credit receipt in the morning. The $2500 deposit refund has already been processed. So, we'll head home and enjoy the holidays. Then we'll think about where we go from here.

Happy Holidays and best wishes to all here.

True! We locked at 4.6 just a couple of weeks ago. Now at 5%.

Even www.bankrate.com has the current overnight rate nationally at 4.9%.

Who knows where it is headed but this will not let house prices rise if it continues.

The Developer gets rich
 

Hey, we should all feel tremendously fortunate that we live in such a great place as The Villages. So what if the Morse family is super-wealthy? They put this place together and I am very happy.

I certainly feel that the Morse family is more deserving of the multi-millions than are the sports stars. Albert Haynesworth of the Washington Redskins on a $100 million contract and refusing to practice - gets benched - and still collects millions of dollars for doing nothing.

Hal did what he thought was right. Do not fault him at all. However, do not bad-mouth the Morse family. If it was not for their vision, we would not be living in this slice of Heaven.

Yes that IRA thing has been nitpicked to death as well. You have those residents who think the Developer is a great business person who can do no wrong. Than there are those on the other side of the fence that say "yes, there is business, but you can take it too far and it turns into greed", and think the IRS thing falls into that category. Personally, I hope that if the IRS thing turns out to be an illegal maneuver, the Morses will be penalized, and the residents will not end up footing the bill. Either the Morses will make it right or the residents will file a class action lawsuit similiar to the other ones they have filed in the past, to force the Morses to make it right. In the end, the great majority of people love living here, and feel it was a good decision to make the move. I'm glad to hear you've gotten your refund - enjoy the holidays!

As I've stated many time before, I love my life in TV and I thank Mr. Schwartz and the Morse family for the this beautiful community. BUT when someone points out that the Morse family has engaged in repugnant behavior they are chastised for bad mouthing the Morse family. What's up with that?chilout We need to be vigilent about our investment and thats why some of us are active in the POA. Our developer needs to be watched and watched carefully.:police:

I agree that we need a "watchdog" organization. The POA has done some really good work in the past.

As far as New versus Resale, we've bought twice in TV, both times resale. Once through MLS and once through VLS. Both times we closed without being in attendance and the process was beautifully streamlined.

I agree with those who think you get "more bang for your buck" with resales. And usually a much lower bond.

We just got back home to Buffalo and a foot of snow in the driveway. Yuk.

I turned on the computer and the TOTV page was still is in the Browser. If you guys keep posting this thread will never end.

Good for you, Mom. When I get down there I'll be by your side. Strive for fair and reasonable.

Personally my view of the world is different from most, an inverted pyramid if you will. People are generally enamored by the rich and famous and quick to defend and forgive. The power elite always seem to get special considerations and a pass on misdeeds. The same people who are so supportive of the upper end can often be heard ranting about welfare cheats and such. In my world, the privileged are held to a higher standard. Those scrapping along the bottom may get the pass. It's just the liberal boomer in me.