Things That Can Go Wrong At Real Estate Closing

Sunday, June 23rd, 2013

Most people are very excited for closing day on their new home.  Unfortunately, many do not realize that things can go wrong, and sometimes do, that will prevent them from closing on that day.

One of the most common issues that arise during closing is a mistake found on the paperwork.  Buyers are advised to not sign any paperwork until the mistake has been corrected.  In most circumstances, the closing may be held up for an extra hour or so, but the mistakes can be fixed and the transaction can go forward as intended.  Another common problem is due to the lack of funds due the day of closing.   This may happen when the sellers owe more money than what they sold the home for and they owe the bank the difference between their mortgage and the sale price on the day of closing.  If cashiers checks are not signed or wired money did not go through, then this can not only make the day longer, but it can also postpone the closing to another day.  It can also be a problem for the buyers if they purchase something large that will affect their credit between the time they applied for the mortgage and the day of closing.  Some banks will do a last minute credit check the day of closing.  If the buyer bought a new car, it may change his or her debt to equity ratio enough that the bank can’t approve the loan anymore.  Another situation that often occurs is when the buyers do a final walk through of the property right before closing.  At the buyers request or the request of a city code, the seller often has a list of things to repair before the day of closing.  If the buyer does the final walk through and any of these items are not repaired or replaced, this can hold up the closing process until the items are fixed.

Any or all of these situations are reasons enough to have an experienced real estate lawyer by your side the day of closing.