How to handle unexpected financing contingency with seller

[Critter]

First post but I've been lurking for a while.

Quick run down, we bought our first home, a foreclosure and have it under contract for a nice profit. It closes 10/13. Found a second home to rehab which is also a forecloser. This home is under contract as well and closes 10/24.

Now a large bank pre-qualified us for the second home while owning the first. Low and behold now there is a contingency for us to sell our house before we close on the new one on the loan approval. I was told several times this wouldn't be the case but now it is.

So this wouldn't be a problem but our realtor said there can't be any contingencies (other than getting financing). I've read the contract and it doesn't specify this but apparently there was some verbal agreement between the two agents.

How should we handle this with the seller? They obviously didn't want any contingencies but we can't avoid it. Would putting more money down help? Have our title attorney review the contract? This deal has been burtal but we see a ton of upside if we can make it work. And advice would be greatly appreciated!!!

[sokoloff]

You could go with a hard money lender.

I'm assuming the closing on 10/13 is a sale by you and the 10/24 closing is a purchase by you?

Your contingency is a financing contingency, IMO. Now, the seller (quite reasonably) wants the contingencies sorted out as soon as possible, but I'm not sure that waiting 4 weeks for that contingency to lapse is such a hardship on the seller.

[Critter]

Sokoloff, yeah I'm selling on the 13th and purchasing on the 24th. Your right, I would certainly consider it a financing contingency as well. I think my realtor might be over reacting but maybe he knows something I don't. It's obviously bank owned who only sees black and white. Any ideas to put thier minds at ease would be more than helpful!!!

[Critter]

What about getting the lender to add an "or" to the loan approval? For instance sell our house "or" x amount of money down. Whatever it takes to keep my DTI where it needs to be, say 30-40%?