In the Portland metro area, Realtors make offers using the association’s standard sales agreement (we still refer to it as an “Earnest Money Agreement” or “EMA”.   Old habits die hard, I guess…).

Then, if a counter offer is made, we use our standard Addendum form, spelling out the terms of the Seller’s proposal.

There’s a first time for everything.  Today was one of those days…  

In an EMA, my client offered $XXXX as a sales price, and asked for $YYYY back at closing to help cover some of his closing costs.

The Seller countered using an Addendum, raising the sales price only, which was accepted by the Buyer and circulated for signatures, etc.   Standard stuff.

Then, the Buyer gave the EMA and Addendum (containing the terms of the counter offer) to his mortgage broker, who after 2 minutes of review is requiring that a new EMA be generated and signed by all parties with the final sales price and closing cost contribution.  He says, “No Addendum allowed”.

A hassle, I know, but the real issue is, and I’ve verified this with other lenders and mortgage brokers…., there are more and more lenders, whom once having reviewed an EMA, will decline to process the loan further due to the use of an Addendum associating sales price and closing cost contributions within the initial offer, and further they would not re-review the proposal even if resubmitted in a format acceptable to them (meaning all terms contained in an EMA document and no Addendum used).

I know there have been some very straight-laced lenders that have operated that way (e.g., Bank of America for this area), but this policy is spreading.

Is this a standard where you are? 

Gotta run…need to get signatures again!