Frustrations Of A Seller When The Buyer Doesn't Close On Time
My seller finally closed on his house on Thursday of this week after a crazy and frustrating several days waiting on the buyer's incompetent lender to do her job. When working with buyers we need to educate them on the need to only work with lenders who are experienced and have processes and procedures in place to ensure the buyer's loan closes as scheduled. Delays can cost the buyer AND seller.
Now, I know that sounds a bit harsh. Like many agents I do call the lender on a buyer's prequal and ask a few questions, IE is the lender comfortable with this proposed closing date, lender experience, etc. Once sellers accept an offer, much is out of their hands. The buyer schedules the home inspection and the sellers waits for any repair request. Lenders schedule the appraisal. Lenders ensure the buyer provides the proper documentation. Lenders send out the CD, sent Documents to title and fund the loan.
Buyer's are giving notice on rentals or selling a home and the dates are critical. Maybe they or other family and friends are scheduling time off work to help with a move. Utilities need to be scheduled on. Any appliances being purchased may need to be delivered prior to moving in. Maybe someone is leaving town a day or two after closing and special plans are in the works.
Sellers's usually have a firm plan for their proceeds, IE buying another house. Utilities need to be turned off, etc. Sellers too have places to go and things to do after closing on a house.
My seller in this transaction was frustrated to find the home inspector had left a trail of insulation from the attic on the bedroom floor. Since the seller had already moved out, he had to go back with a vacuum cleaner to clean the carpet. (okay, sometimes this happens, but from the seller's perspective this is not the way to treat a seller who made the property available for the inspection.
The buyer sent over a lengthy list of repair request, of which the seller agreed to several repair items. Both sides agreed on a final pairs. Then came the FHA appraisal. The FHA appraisal identified two repairs to be completed to fund the loan. My seller diligently attended to all repairs.
Now the day the buyer was to receive their CD, the lender discovered she had put the wrong day in the system, so rather than a CD going out on schedule, she was off by one day. She would send it the following day and closing would only be delayed by one day. She did apologize. So instead of a Thursday CD to the buyer she could expect it Friday. Well, you guessed it, the lender stated she was unable to see in her system if the CD went out. When Monday arrived, she was surprised to find out that the CD didn't go out on Friday.
Fortunately the CD did go out on Monday and the buyer signed Thursday and the loan funded the same day. My frustrated seller could not control any of the closing activities. Our sellers look to us to represent them in a transaction and often believe we have more "authority" to get things done than we actually do.
In this case the buyer's poor choice of a lender (a personal friend) cost my seller four additional days of holding cost, anxiety, jumping through hoops to sign documents the lender stated needed wet signatures rather than electronic signatures. He had to alter his work schedule to get documents signed and again when the lender demanded wet signatures on the Amendatory Clause before loan documets would be sent to title. The buyer and her agent did everything they were asked to do along the way.
We all try to prepare our clients for potential bumps in the road, but after several delays, not of which the seller could control he was left wondering if this was ever going to close. Unfortunately there is no repercussion that I know of for lender errors, just unexpected costs and stress to buyers and sellers.
I will say that the lender I use for my clients in incredibally responsive and has the proesses and systems in place to ensure he can deliver what he promises, as do many lenders. We just need to guide our clients and let them know not all Realtors are created the same and not all lenders are created the same.
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