There are six major issues in getting from contract to close in Brooklyn NY. These are the “moments of truth that put transactions at the greatest risk. Knowing these is critical, but also knowing the certain ways in which they can go wrong is equally critical. Above all others, your agent and your real estate team are the most responsible for getting a sale to a successful closing. Think of your agent as not only the one who makes the sale, but also the one who makes sure it closes. To do this your agent must be aware of, ready to handle, and better yet prevent any and all mishaps that might arise. Here is a breakdown of the common issues we come across and common solutions to each one.
1. Inspections and Repairs
How things can go wrong
- – Unexpected findings
- – Report complexity
- – Costs and who pays
- – Timetable for repairs
- – Doubt about worthiness
- – Wary first time buyers
- – Alarmist inspector
- – Unreasonable buyer
- – Unreasonable seller
Solutions
- – Seller gets a pre-inspection
- – Make sure agent attends inspection with buyer and/or seller
- – Pre-negotiated limits
- – Recommend inspectors who are diligent but not alarmists
- – Prepare and reassure buyer
- – Prepare and reassure seller
2. Appraisals
How things can go wrong
- – Won’t support the price
- – Won’t support the loan
- – Doesn’t match the CMA
- – Bank required repairs
- – Kitchen in basement
- – Non-permitted item(s) (i.e. Extension, deck, structure, etc)
- – Garage conversion
Solutions
- – Provide appraiser with good comps
- – Find additional buyer funds
- – Appeal the appraisal
- – Have a handyman and home pros ready for quick addressing of issues
- – Remove stove prior to appraisal
- – Have a lender who can do the loan with non-permitted items
- – Have a lender who can do the loan with garage conversion
3. Loan Approval and Funding
How things can go wrong
- – Application delays
- – Documentation problems
- – Buyer credit issues
- – Lender failure to approve
- – Lender failure to fund
- – Buyer credit changes
Solutions
- – Select originator – get preapproval
- – Have agent assist buyer with paperwork
- – Get credit counseling for buyer
- – Reapply with corrections
- – Parallel applications
- – Give preclosing credit warning
4. Other Contingencies
How things can go wrong
- – Sale of the buyers’ house
- – Third-party approvals
- – Estate, relo, short-sale approvals
- – Clouded title
- – Open permits
- – Open violations
- – Issues with Certificate of Occupancy
Solutions
- – Take backup offers and get documentation on sale of buyers’ house
- – Know who and communicate
- – Know who, how, and timetable
- – Do a pre-title search
- – Have an expediter look into outstanding permits
- – Look into open violations prior to listing and have an expediter ready to resolve. If violations cannot be resolved, speak to your agent to come up with a game plan once you start showing
- – Do a CO search
5. Cooperating Broker
How things can go wrong
- – Bad advice or communications
- – Inattention to details
- – Poor vendor selection
Solutions
- – Make sure your agent clarifies the messages and intentions
- – Make sure your agent owns the process and communicates
- – Have your agent provide selection list and back ups
6. Deadlines
How things can go wrong
- – Inspections and repairs
- – Commitment
- – Closing date
- – Occupancy
- – Approvals/Documentation
Soltutions
- – Confirm appointments and progress
- – Make sure your agent is following up consistently
- – Build in buyer and seller flexibility
- – Preset dates, limits, and penalties – Have a plan B game plan in case of vacancy issues
- – Manage the closing checklist – Make sure your agent can work quickly to resolve issues as soon as they arise
Hope this all makes sense. If you have any questions or need some advice, feel free to Contact Us anytime 🙂