Things that will delay the closing when buying or selling real estate in Philadelphia. Closing is the final step in a real estate deal that both buyers and sellers aim to complete as quickly as feasible. It occurs when dotted lines are crossed, money and ownership are exchanged, and both sides receive what they desire. The trouble, though, is that there are so many unknowns and barriers along the way that you can’t count your closing chicks until they actually hatch. But, what are some of the most significant and prevalent closing roadblocks? To answer that question, here are 5 things that will cause a delay in the closure of a real estate transaction in Philadelphia.
1. Financing Problems
To acquire real estate, the majority of individuals need a mortgage loan; very few of us have enough cash on hand to make a cash purchase. As a result, finance issues are frequently at the top of the list of things that will cause a delay in the closure of a real estate transaction in Philadelphia.
After speaking with a lender, many purchasers believe they have secured financing, only to have things fall apart once the lender checks their financial condition more closely. Here are some of the most typical finance issues that cause the closing to be delayed:
- Failure to get or inability to get pre-approved
- Failure to provide 100% accurate information to the lender
- Job loss or job change
- Inflation of debt-to-income ration
- A drop in credit score
- Opening new lines of credit
- Making major purchases
2. Title Issues
When buying or selling real estate in Philadelphia, title issues are right up there with title issues for the top spot on the list of reasons that will cause the closing to be delayed. Remember that before lending money, lenders will conduct a title search to check that there are no other parties that have a claim on the property. The purpose of a title search is to safeguard the lender and buyer from situations where the property is subject to debts or liens, and/or entities other than the seller can claim legal possession.
Here’s what industry pros say about title issues: “The most prevalent cause of closing delays is title report difficulties. Some sellers are utterly ignorant that past liens exist on their property, leaving buyers frustrated as they wait for these often lengthy fixes. The most effective ways to avoid these costly delays are title release tracking and title curative services.”
Contact a Philadelphia agent at (215) 385-3055 to learn more about this typical closing delay – and what you can do about it.
3. Low Appraisal Value
Lenders will want an appraisal to confirm that the property is worth at least as much as the loan amount. Also, if the appraisal is completed late in the game or another appraisal puts the property at a lesser value than the first, the closing may be delayed.
“In theory, you’d find out if there were any concerns with the home’s assessment before the closing date. When it comes to purchasing and selling properties, however, theory does not always match reality. When a home does not appraise at or above the sale price, and the parties’ criteria are not properly conveyed, issues with appraisals might occur. A bank may request repairs before to closing, or another appraisal may be required, causing the process to be delayed.”
4. Instrument Survey Problems
A mistake with the instrument survey is an often neglected factor that might cause a delay in the closure of a real estate transaction in Philadelphia. Even homes that have been bought and sold without incident multiple times before may be vulnerable to instrument survey concerns upon additional inquiry.
“Experts warn that a home of any age might run into boundary line encroachment conflicts over the property it is built on. Property lines, walls, or fencing may become a source of contention, causing the closing to be postponed until all parties can resolve their differences through signed affidavits.”
5. Inspection Issues
The majority of buyers will demand that the purchase contract include an inspection clause or contingency. They’ll want a professional examination to ensure the property doesn’t have any costly issues or require extensive repairs. They want to be allowed to get out of the transaction if the inspection reveals any issues. And, of course, if major issues are discovered, the closing may be postponed.
Inspections are usually performed early in the process because of this. If the inspection reveals that repairs are required, the buyer and seller will have plenty of time to work out a solution before closing. However, this isn’t always the case.
“Some of these repairs may not be completed due to miscommunications, delays, or simple neglect, and this will typically be discovered at the final inspection. Expect delays since mortgage lenders will not tolerate this because they are not obtaining what is specified in the contract. Final inspections can also identify unanticipated issues like malfunctioning appliances or plumbing fixtures. Closing delays will also be caused by such situations.”
Using a Philadelphia Agent to Avoid Closing Delays
As you can see, a lot of elements must fall into place for the closing to take place on schedule and without delays. Your best bet for avoiding closing delays is to have an experienced Philadelphia agent on your side to assist you through the process and ensure that all of the necessary parts are in place when the time comes. So, if you absolutely want to prevent these delays in closing while buying or selling real estate in Philadelphia, give us a call immediately at (215) 385-3055.