When you go under contract on a home, there are many issues that can cause a closing to be delayed. Knowing these issues in advance, may help you to circumvent these potential roadblocks or, at the very least, empower you to make preparations in the event your closing is postponed.
1. Appraisal Report – If the appraised value of your home comes back less than the contract price, the seller has the option of either reducing the contract price or terminating the contract. If there is a substantial difference between the contract price and appraisal, the seller may want a second opinion. Or, the listing agent may submit sold comparables to the appraiser, to help justify the sales price. This back and forth exchange between the lender, appraiser, or the third-party company responsible for ordering the appraisal report, may hold-up closing. If it is critical to you that closing occur on schedule, make sure you or your agent follow-up with the lender regarding when the appraisal will be ordered, and when they should receive the results back.
2. Lender Required Inspections – Depending on the type of loan you are securing, the lender may require a satisfactory termite report. If the home is located on a well and septic system, the lender may also require a satisfactory report on these systems. You can connect with your lender upfront, to determine if these inspections need to be completed and submitted prior to closing.
3. Title Issues – If your settlement company has not ordered the title work or there is a delay in getting back the results, this can cause a delay in closing. Also, any unexpected or unforeseen liens on the property, may postpone settlement. By performing the title examination as early as possible, more time is allotted to uncover and resolve these issues in a timely manner.
Stay tuned tomorrow for more information on potential closing hurdles.