Encountering the Stark Difference Between NY and VA Real Estate
Practicing real estate in the Commonwealth of Virginia since 2005 I have learned the various ins and outs of transactions in our state. However, when you have someone selling in another state, whose home purchase in Virginia is contingent on the sale of a home in another state, it's a good idea to pick up the phone and call the listing agent in the other state and get a feel for how things work.
This was the case when my brother and I got the offer on our mom's condo. It was a buyer who had a coinciding settlements contingency for the sale of his home in New York, but would be paying cash from that sale. For starters, the buyer's agent representing him in Virginia was one that I knew. His reputation was solid. He assured me that things were great and running on schedule in New York. He backed that up with providing me contact information for the New York listing agent, Mary. He also gave me the proof of funds that would be applied to the Virginia condo purchase from the New York purchase.
Prognosis was good. Mary said all the inspections were done and survey had just been completed. Settlement was happening within a week or two. Our settlement was for three weeks out. That all sounded great.
Unlike Virginia real estate where lenders and title companies are tasked with making a settlement date that the buyer and seller have agreed too, and pushed by agents to make that date, New York is all about attorneys. Everyone has an attorney. And deadlines are, as it turns out, suggestions. Settlement happens when all the attorneys are ready to schedule it. Also unlike Virginia real estate, crazy things like decks that were build without a permit can halt a transaction. Evidently, a certificate of occupancy MUST be issued before the lender will fund the loan.
When this issue came out, it was the week before our December 21st settlement. I called our buyer's agent and he said that in New York, as he was told by Mary, there is an automatic thirty day extension for this title issue. So the assumption was this problem can't go more than thirty days. We agreed on a January 16th settlement date. Well, that's out the window now too. The attorneys have all the information, but haven't yet scheduled settlement and a Closing Disclosure still hasn't been made to the buyer up there in New York.
In representing my Virginia home sellers in the future, any coinciding settlement contingency from a New York home sale is going to come with this story about how a three week settlement became a sixty day settlement (if it ends up closing that quickly at this point.) Virginia and New York could not be more different in how they conduct business, and how uninvolved in the process the agents are.
Meanwhile, my brother and I are being asked if we give this buyer more time. It seems he is near the finish line in New York, but that's also what were told thirty days ago. Decisions, decisions.