Buying a house is a lot more work than buying dinner, but after almost a month, it’s practically yours.
At least that’s how it feels. In reality, there’s a lot that can still go wrong, even down to the last minute of closing.
Getting Denied a Loan
Even if you’ve already been pre-qualified for a loan to buy the house, your bank or mortgage company could still pull out at the last minute. Unless you’ve been pre-approved, there’s still a risk.
Don’t buy anything expensive until the home is yours. Buying a car or a lot of new furniture could affect your credit score and make your lender nervous. Even something as innocuous as opening a new credit card account could lose you the loan.
Losing your job can also cost you the loan. Unfortunately, you don’t have direct control over that.
Perhaps you find property damage on your final walkthrough that you missed the first time. If the damage is serious enough, it could cause a conflict or delay. If the damage is severe, you might even consider withdrawing from the deal.
For sellers, make sure the property is in good condition before putting it on the market. For buyers, make sure to thoroughly look over the property. You may want to hire an inspector.
Cloud on Title
When you hire a title company, they research the property you’re buying. They check all the transactions involving the property over a period of time and make sure there’s nothing suspicious. This research protects you in case there’s some uncertainty or disagreement about who actually owns the land.
If the title company does find something strange, it’s called a cloud on title, and it can delay closing. You don’t want to buy a house with a cloud on the title, so hire a title company ahead of time.
Rochford has decades of experience with titles. Make sure you have a clear title.
Sometimes the buyer or seller changes his or her mind and backs out at the last minute. Make sure you’re ready to go through with the deal so you don’t change your mind during closing.
It’s also possible that one party could die. According to real estate website Think Glink, “If the seller dies after signing the contract, the estate must go through with the sale. However, it may be difficult to close on time, particularly if the seller dies close to the date of the closing, or if the estate is in probate court. If you die, the seller may be able to force your estate to continue with the sale, pay damages or lose your earnest money—although in the real world, sellers probably won’t force the issue.”
Make sure your name is the same on all documents. If like me, you go by a name other than your legal name, be especially careful. You don’t want to have Jim on some documents and James on others. Check for spelling mistakes, too.
Miscommunications about Move-in Day
Sometimes parties get their wires crossed about when they’re supposed to move in. This is an easy problem to fix, however. Ask questions. Make sure everybody is clear about the timeline. Don’t assume.
Real estate transactions are complex. From contract writing to liens, from filing to negotiation, you need an expert on your side to help you get the best deal and to make sure what will probably be the biggest financial transaction of your life goes smoothly.
John Rochford has over 25 years of experience in the real estate title business. Let him represent you.