Real NEastate: Will the seller wait for my credit score to go back up?

Q: I was all ready to buy my first home this Friday in East Torresdale but, even after being pre-approved a few months ago and after giving the mortgage company everything they needed, my loan request was denied because my credit score went down while I was waiting to make settlement. My loan officer said it will be another month or two to get my credit score up and buy this house. Do you think the seller will wait for me?

A: When buying a home, it is prudent to make sure all your bills are paid on time and you don’t make any major purchases, or run up any credit cards before settlement day occurs. The mortgage lender will usually run your credit score again just before settlement to see if you are still “mortgage-worthy.”

It may take longer than a month, depending what you did to get your credit score downgraded. If I were representing the seller, I would want to know the entire story. Is it that your credit card bill got paid late, or did you miss a car payment? Different incidents hold different weight with the credit scoring companies. I’ve had clients wait up to six months to get back on track and be able to buy.

I would be worried the seller may not wait, but it this market, the seller may not get another buyer faster than your credit score rises. Ask for a one- or two-month extension to the Agreement of Sale. You may get lucky and find a willing participant in the extension.

If the seller is not willing to sign an extension, maybe he/she would be willing to extend the sale if you let the seller’s agent keep marketing the property for sale. The seller would then have “First Right of Refusal” should another offer come in and you could lose the property. But you don’t have it now, anyway based on your mortgage company’s denial.

Stacey McCarthy is a real estate agent with the McCarthy Group of Keller Williams. Her Real NEastate column appears every Wednesday on NEastPhilly.com. See others here. Read other NEast Philly columns here.