It’s hard to imagine, that is until you’ve worked in the real estate world, how many things can be a stumbling block to a timely closing. .Without the proper mindset and a good contingency plan, you could be doing a little “unintended camping” – now a part of the real estate vernacular.
So you’re under contract and all is right with the world – right? Life is just a bowl of cherries, or to be Florida appropriate, oranges. You or your buyers have already gotten your preapproval so what could possibly go wrong?
To quote Shakespeare, “let me count the ways”
#1 The home inspection – Bet you didn’t think about the fact that you have a Zinco/Sylvania electrical panel did you? That could be a problem for some insurance companies, and some inspectors might couch it to their clients as if it would suddenly explode, incinerating your home in a single blast. They may also not like the fact that there is an open permit on your roof – from 14 years ago – quite possibly before you even bought the house. Or maybe your attic has become a vacation “hot spot” for the local rodent population and they really do love all that new insulation you blew into the attic two years ago. Our suggestion is, if you are not one of these “hands on, really handy” individuals, who spend their free time re-plumbing the bathroom just for fun, talk about this point with your realtor – maybe it’s worth getting a home inspection first. If you are one of those self-plumbing- types, you’d want to make sure any changes that required a permit actually got one!
#2 the appraisal – Contrary to popular belief – or unpopular, as the case may be, a realtor cannot talk an appraiser into a higher price. In fact we’re not even supposed to “talk” to them about the appraisal at all. The pendulum has swung the other way in the appraising department and BANKS are not even allowed to speak directly with the appraisers. In fact, I’m pretty sure there’s some clause in the statutes that says the appraisers aren’t even allowed to talk to their husbands or wives about the appraisal – ok I’m exaggerating just a bit, but, gone are the days of unspoken coercion from the banks…“this appraisal had better come in at sale price or we’ll find ourselves another appraiser” wink wink. No, now there’s a middleman in the form of an appraisal management company who hires and manages the appraisers. The problem is that that appraiser might be from another county and completely unfamiliar with your area. A good realtor will provide comparable properties for the appraiser – just in case he or she might miss something, but who knows if that appraiser will use them to wipe off his windshield after a flock of seagulls has stormed the driveway. Discuss the solutions to this with your realtor. If the property does not appraise your buyers cannot get the loan unless they are willing to pay the difference. In this market they may just be willing to do that.
#3 Underwriting – (said an octave lower and with reverence). These are the elves in Santa’s workshop that actually produce the toys, the wizards behind the curtain that turn your loan application into an actual loan, the oracle in the grotto that… you get the idea. Sometimes, unfortunately, they are human and get a little fussy or annoyed that we pesky realtors keep demanding to close “on time,” when they have 14 other files on their desk and we’ll just have to wait our turn. Just saying … Talk about getting all your information into your lender (harder if you’re the seller) right away – even though they will most likely ask for more documents going forward, at least you won’t be delaying anything yourself. For a VA loan, I’d allow more time to close – just because you’ll probably need it!
#4 Acts of God (aka the weather).We hadn’t had that much rain in probably 30 years, but the week before closing, there was a reenactment of the great flood – minus the giraffes, that is. The inspector had been right, the roof didn’t leak but now water was coming in under the transom of the sliding doors. I guess that it really was in a “flood” zone. Our suggestion: get with your realtor and maybe say a prayer …
#5 Acts of less godly conspirators… The day before closing, everyone was anticipating being done with the process, the only things left to do, other than sign, was a final walk-thru of the home – usually, a pretty straight forward activity. When the new buyers walked through the house and out to the pool, they were certain their eyes must be deceiving them. Little had they known that the neighbor, a disgruntled family member, had decided to jackhammer the pool the night before closing – surprise and welcome to the neighborhood! You can talk to your realtor about this but it’s hard to make a contingency plan for crazy just be open to solutions!
So what’s the point of all this? Stuff happens – even when you’re on top of things. So if you don’t have a place to stay and your truck will be all packed with nowhere to go, it’s a good idea to think ahead and have options. Count on something coming up and plan accordingly but then be pleasantly surprised when it doesn’t! Here’s to not catching you off guard.