Real estate transactions are never easy—and rarely go as planned. While some can close without any issue in as little as 30 minutes, there are others that can have significant delays. Regardless of what has happened, it is important to understand why delays and issues arise during the end of a real estate transaction—and how you can possibly help to avoid them.
Errors in Closing Documents
The most common closing issue is when a document error occurs. This can be as simple as a misspelling in a nameor an incorrect address. Sometimes there are serious typos, such as an incorrect purchase amount or missing pages altogether. These delays can lead to several hours or even days because the closing agent will then have to redraft and organize the paperwork so that it is ready for signing.
To avoid this, you should remain in constant communication and review documents as you see them during the purchase process. Most of what you sign at closing is seen before you show up. Therefore, it is always double check your loan agreements and related documents and look for any name errors, address typos or even incorrect loan amounts. Always question anything that seems incorrect and never assume that the bank will find and correct the error. Banks process hundreds of loans each month and are unlikely to catch minor details that you may easily notice.
Plenty of financial issues will arise during a real estate closing. Just some of the things that can happen include:
- An issue with a down payment. Your bank does not transfer the down payment amount to the closing agent; therefore, they cannot process the closing.
- You are required to bring more money down to closing than originally discussed. Often times your down payment can increase by a few hundred or thousand dollars if there was an accounting error by the lender.
- You show up to closing with a personal check, which is never accepted. The only way is a cashier’s check or wire the money to the closing agent.
- The other party does not have their funds in order, which delays the closing regardless if you have your funds in order.
You can avoid these issues by making sure you have a cashier’s check for the entire amount. Check with the closing agent a few hours before your appointment to verify the amounts. If there have been any changes, go to your bank for a new check or a check in the additional amount to ensure you get the right amount to the agent at closing. If you don’t know how much you need to bring, you can always bring more; you will get a refund later and avoid having a delay in your closing.
Loan Documents MIA
The closing agent rarely works for the lender or even in the same office. They wait for documents to arrive at their office via messenger and sometimes they do not arrive. You will want to call your closing agent a few hours before the appointment to make sure all paperwork has arrived and then contact the lender to find out where the missing documents are. The more proactive you are, the less likely documents won’t make it to the agent.
Title Lab Can Help
After the grueling home buying process, most buyers are anxious to get the closing over with. You can avoid unnecessary headaches by using a reputable closing agent. Contact Title Lab for more information about how we close loans or to use us for your closing.