Nobody wants to delay a closing—not your client and not you. But, in fact, nearly a quarter of real estate professionals say they’ve recently faced a delay to settlement, and 5 percent say they’ve had a signed contract terminated without completing the transaction, according to the February 2017 REALTORS® Confidence Index, a survey of more than 2,300 REALTORS®. These sobering stats raise questions about what could have been done to keep closings on track.

Some delays are unavoidable, such as a buyer losing a job in the midst of a purchase. However, buyer’s agents may be able to address other thorny issues that arise. “The three major causes for delay we’re seeing come down to the lender, appraiser, and inspector,” says Candace Cooke, ABR®, president and owner of Real Property Counselors Inc., in Buchanan Dam, Texas. Cooke covers strategies to overcome closing hurdles in the ABR® designation courses she teaches through the Real Estate Buyer’s Agent Council (REBAC). These challenges, cited in the REALTORS® survey, include obtaining financing (36 percent); appraisal issues (20 percent); and home inspection and environmental issues (13 percent). Facing such potential land mines, how can you navigate a transaction to closing with as few hiccups as possible? The following tips should help your buyers get to the finish line on time.

Financing 

Preparation and education are key for successful financing. Here are suggestions worth sharing with clients:  

Talk to the lender first. Before buyers look at a single house, urge them to get preapproved. “Buyers may believe their credit rating is better than it really is,” says Cooke.

Gather documents. At the start of the process, provide buyers with a list of documents they’ll need to give to a lender, including tax returns, bank statements, paycheck stubs, and, if applicable, a divorce decree (even 20 years later). Let clients know that lenders’ rules vary concerning necessary documents. “Just because you turned in the first set of documents, you’re not done,” Cooke says. “Lenders are going to ask for a lot more information.”

Keep your finances steady. Cooke references “The 10 Commandments of Buying a Home.” (Google it!) It warns of avoiding behaviors that could jeopardize financing, from using credit cards excessively to quitting a job. 

Appraisal Issues 

Appraisals are again becoming a hot issue in real estate. In the REALTORS® survey, respondents blamed appraisal-related delays on a shortage of appraisers, valuations not on par with the current market, and “out-of-town” appraisers who were not familiar with local conditions. It’s important for buyer’s agents to learn how long appraisals are taking in a specific area.

Account for that timing in your sales contracts. Appraisal delays are especially acute in rural communities, where lenders are struggling to even find appraisers, says Cooke, who is also a licensed appraiser. “There are not enough to get the work done in the time frame your buyers may need to close in,” she says.

Buyer’s agents also need to be proficient in estimating fair home prices. “Don’t just go along with what buyers want to do,” Cooke adds. “Do that CMA and advise clients accordingly.” After all, the appraiser’s job is to ensure the lender’s investment, not the buyer’s.

Home Inspections

Home inspection reports can sometimes lead to a delay. Buyers need to understand that sellers are not obligated to take care of every issue. “No one is responsible for doing those repairs. You have to negotiate them,” Cooke says.

Because so many issues can pop up to threaten a sale after a contract is signed, you and your clients need to stay vigilant. “It’s never a sure thing.” Cooke says. To keep the odds in your buyer’s favor, stay on top of the details and anticipate every step you and your client need to take to get to the closing table.

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If you or anyone you know is looking to Sell or Buy a home anywhere in Apopka, Orlando or the Central Florida area, please follow the links below for either an INSTANT Home Value & Market report or a FREE MLS Search of All Homes For Sale on the local MLS System. For more information or a no-obligation consultation, contact Joe Bornstein, Broker, Rock Springs Realty, Cell# 407-252-8092 or Toll Free# 877-333-2811 or joe@rockspringsrealty.com 

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