pyt Questions and answers

Sellers

HOW CAN I VERIFY WHETHER A PYT LOAN COMMITMENT IS VALID?

Go to the web site www.protectyourtransaction.com, click on "Verify Commitment" link, enter the Commitment number, and you will be advised of its authenticity, certificate status, expiration date (if applicable), any exclusions as they currently exist - i.e., appraisal, inspection, title, or other and the PYT Lender's contact information.

IF THE CLOSING FAILS, AM I ENTITLED TO FUNDS?

If the lender does not fund the loan, for a reason other than those excluded in the PYT Loan Commitment, the disbursement of funds to buyer (or into escrow if buyer assigned the liquidated damages to escrow) will happen promptly after the exhaustion of all contractual extensions afforded the buyer and delivery by the Seller of a notice of cancellation of the transaction in accordance with the terms of the contract. Further disbursement will be made by the escrow agent pursuant to the terms of the escrow instructions.

I'M A SELLER; WHAT WOULD CAUSE MY PROPERTY OR MY ACTIONS TO DISQUALIFY ME FROM THE PYT PROGRAM?

Property exclusions include; but not limited to: co-ops, non-warrantable manufactured homes, flip transactions, short sales, non-residential property. Additionally seller cannot take any action to impede the timely closing of the property or to act in any manner inconsistent with the purpose of the purchase and sale contract.

I'M A SELLER AND WILL BE BUYING ANOTHER HOME. HOW DO I GET A PYT LOAN COMMITMENT WHEN I MAKE AN OFFER ON A HOME I WANT?

Only PYT Certified Lenders are eligible to issue a PYT loan commitment. Please go to the Lender section of this website. Any PYT Certified Lender would be very happy to meet with you and start the process to help you move forward.

DOES PYT COST THE SELLER ANYTHING?

There are no additional costs to participate in the PYT program.

AS A SELLER OR SELLER'S AGENT, I WANT TO MAKE SURE A BUYER MAKING AN OFFER IS IN A PYT LOAN PROGRAM. WHAT SHOULD I DO?

Your listing in the MLS can include a statement that preference will be given to offers backed by a PYT Loan Commitment. This will alert all agents and buyers interested in your property that you wish them to present a PYT Certified approval with the offer to purchase your home for your primary consideration. Your agent may contact PYT or a PYT Certified Lender for further instructions.

Buyers

AS A BUYER WHY WOULD I NOT BE OFFERED A PYT LOAN COMMITMENT?

A PYT loan commitment requires a fully underwritten credit approval from a delegated Underwriter of a PYT Certified Lender. Accordingly, the Buyer must be very proactive up-front, supplying all of the necessary documents for approval in a timely manner. Failure to respond quickly and completely to document requests, or creditworthiness issues will prevent a PYT loan commitment from being issued.

WHEN IS A BUYER ISSUED A PYT LOAN COMMITMENT?

A PYT loan commitment is a full credit underwriting approval and is issued only after the PYT Lender has obtained all necessary documents and information. This process can be completed prior to the Buyer's purchase offer; however, it is expected the PYT loan commitment will be issued no later than fifteen (15) days from the Borrower's loan application date.

AS A BUYER WHY WOULD MY PYT LOAN COMMITMENT EXPIRE?

Each certificate has an expiration date which requires your loan to be funded by that date. In order to extend that date, certain credit items (credit report/pay stub, etc.) will from time to time require updating.

AS A BUYER WHY WOULD MY PYT LOAN COMMITMENT BE CANCELLED?

Each PYT loan commitment requires that the buyers not do anything during the process to reduce their creditworthiness such as quitting a job, reducing income, incurring new debt, dissipating funds and similar actions. Each commitment has exceptions for items not cleared prior to the commitment being issued. The most common examples are: title commitment and appraisal because the property is often unknown at time of issue. Additionally, we require that all parties to the transaction do nothing to delay or impede the transaction from closing. For a complete list of cancellation events please refer to the PYT loan commitment.

I'M A BUYER; CAN YOU GIVE A PYT LOAN COMMITMENT TO MY LENDER AS THEY HAVE ALREADY APPROVED ME?

PYT loan commitments can be issued by any PYT Certified Lender. Please ask your Lender if they are PYT certified or offer a written loan commitment with financial assurances to protect your transaction against their failure to perform.

WHY SHOULD I MEET WITH A PYT CERTIFIED LENDER BEFORE WRITING AN OFFER?

A PYT Loan Commitment issued by a PYT Certified Lender is a credit approved and underwritten loan commitment. A seller will be more likely to accept your offer over other competing offers by knowing that with a PYT loan commitment your Lender has approved your creditworthiness and is standing behind that approval with financial assurances. Being in the PYT program strengthens your offer.

ARE THERE ANY ADDITIONAL COSTS TO A BUYER USING THE PYT PROGRAM?

There are no additional costs to participate in the PYT program. The PYT program is simply a Lender's commitment to provide great customer service and back up that commitment with financial assurances. PYT Lenders believe a borrower should not have to pay their Lender additional money in order to do their job.

WHY WOULD THE BUYER ASSIGN THE LIQUIDATED DAMAGES TO ESCROW?

The Buyer is under no obligation to assign the liquidated damages. However some buyers believe that by assigning some amount of the Lender's financial assurances to the other parties in the home buying transaction, such as the Seller, that the assignment of this transaction protection may strengthen their offer.

IF FUNDS ARE PAID TO THE BUYER FROM THE PYT LENDER, IS THE PAYMENT TAXABLE?

In the event Lender makes any payment of any Liquidated Damages under the PYT Commitment, the payment is considered taxable income to the Borrower and will be reported to the IRS on Form 1099-MISC even if the payment is assigned. Borrower is responsible for all federal and state income taxes related to this income. If you have questions about this provision, please consult with your tax advisor.

REALTORS®

DOES PYT COST THE AGENT ANYTHING?

There are no additional costs to participate in the PYT program.

AS A SELLER'S AGENT, I WANT TO MAKE SURE A BUYER MAKING AN OFFER IS IN A PYT LOAN PROGRAM. WHAT SHOULD I DO?

Your listing in the MLS can include a statement that preference will be given to offers backed by a PYT loan commitment. This will alert all agents and buyers interested in your property that you wish them to present a PYT loan commitment with the offer to purchase the home. You may call us for further instructions.

WHEN IS A BUYER ISSUED A PYT LOAN COMMITMENT?

A PYT loan commitment is a full credit underwriting approval and is issued only after the PYT Lender has obtained all necessary documents and information. This process can be completed prior to the Buyer's purchase offer; however, it is expected the PYT loan commitment will be issued no later than fifteen (15) days from the Borrower's loan application date.