Common Reasons Your Real Estate Closing May be Delayed

When it comes to buying and selling real estate, closing a transaction isn't always cut and dry.  There typically tends to be at least a few small hiccups along the way.  As a buyer or seller, you may not see those hiccups because your lender, real estate agent, and title company at the Lake of the Ozarks are working on the back end to address the issues as quickly and painlessly as possible.  While these hiccups may not always be seen by you, they do happen.  Unfortunately, some problems that arise can cause delays in the closing process.  And while closing delays are not extremely common, they can still happen.
Whether you are in the process of buying or selling a home at the Lake of the Ozarks, or you are planning on buying or selling a home in the future, it is important that you understand that there CAN be delays in a real estate closing.  A common misconception that both buyers and sellers often have is that the closing date in a real estate contract is actually when the closing will occur.  While it is important to have that target closing date, and it is great when the closing actually occurs on or before that date, it just isn’t always possible.  No matter how prepared the buyer and seller are, there may be a few factors encountered during the closing process that are outside of your control.  Below, Arrowhead Title, Inc. has provided some reasons your real estate closing may be delayed.

1. Unrealistic Contract Dates

One of the most common reasons why a real estate closing is delayed is because of unrealistic contract dates that were agreed upon in the purchase offer.  If there are no issues with financing, inspections, contingencies being handled, or any other number of variables, it may be easy for all parties to meet the set deadlines.  However, when it comes to real estate transactions, it is hardly ever the case that something doesn't arise to throw off the smooth flow of the transaction.  Generally speaking, it can take roughly 45 to 60 days for a real estate closing to occur after a purchase offer is accepted.

2. Appraisal or Last Minute Inspection Issues

When buying or selling real estate, some big factors that play a significant role in the closing process are the appraisal and the home inspection.  Not only do these affect financial aspects of the contractual agreement, but they can also determine whether the transaction will finalize and/or require a delay in the closing process.
For the most part, home inspections are done early in the process of the real estate transaction, and for good reason.  If there are any repairs that need to be completed, this gives the parties involved the time to accomplish these repairs, or to come to agreements regarding repairs needing to be done.  However, due to miscommunications, delays in the process, or even simply neglect, sometimes these repairs are not finished to the terms required in the contract, and this comes to light during the final home inspection.

Common things to look out for (especially as a buyer) in the final walk-through include:

  • Ensure that the agreed-upon repairs are included
  • Check that the Furnace and Air Conditioner are functioning
  • Ensure all included Appliances and all Toilets are functioning
  • DON’T FORGET to check: All Utilities are functioning (water, electric, gas, etc.)

If the inspection comes back with some serious issues and the two parties can't come to an agreement on resolving the issues, it could cause the deal to fall through.  If a property appraisal comes back lower than the original agreed-upon purchase amount, this could cause a counter-offer to be submitted by the buyer, which could essentially break the deal.   At the very least, either of these common occurrences could cause a delay in the process while the buyer and seller are trying to compromise.

3. Third-Party Scheduling 

The process of buying and selling real estate often involves many members of many different teams working together for the ultimate goal of closing on a sale.  Home loans are a huge process and can in themselves involve multiple teams working close to the loan.   Anyone who is not directly affiliated with the buyer or seller of the real estate (a third party), can sometimes hold up the transaction process.  Third parties could include home inspectors, appraisers, surveyors, anyone providing verification of income, and any of the many team members working to assist in the closing of the real estate transaction that may be considered more “behind-the-scenes” workers during the process. 

4. Lender or Underwriting Issues

Often times, buyers think that once they receive their mortgage commitment that they're clear to close.  While most of the time this is true, most lenders will review a borrower's credit information another time before finalizing the loan, just to ensure the security of the loan.  If any noticeable changes in credit are detected, this will likely throw a red flag in underwriting and further documentation will be required for review.  That's why it is essential that while you are waiting for a real estate transaction to finalize, you do not make any changes to your credit history that could affect the loan approval.

5. Title Related Issues

Another common reason why a real estate closing can be delayed relates to the title of the piece of real estate.  There are certain title related problems which actually arise frequently.  Most of the common title related problems can be solved, but take significant time and will likely delay the closing or possibly cause the deal to fall through due to time constraints.  A thorough title search is the most effective way to safeguard against delays associated with title-related issues. 

6. Discrepancies in the Closing Statement

Prior to a closing in real estate, both the buyer and seller are given their respective closing figures.  This document breaks down what each party is financially responsible for within the transaction.  A common issue that causes closing delays is due to one or both parties being in disagreement of their financial responsibilities as they are laid out on the closing statement.  When this happens, there may be a delay in closing because the parties need to re-evaluate the terms of the contract and come to an agreement on who is covering what.

7. Unavoidable Circumstances

Finally, even if everything goes according to plan, delays in closing can still occur.  Natural disasters, human error, and unexpected occurrences in the lives of those parties involved in the process, can all add up to delays in closing the real estate transaction.  These are just unavoidable circumstances that occur in everyday life that may hold up the closing process.  While closing delays are uncommon, they can still happen because of unique circumstances.  A great way to ensure a smooth closing is to know what to expect at closing and how you can prepare.

Accuracy Matters at Arrowhead Title

These are just a few of many reasons your closing may be delayed.  While we know that delays do happen with real estate transactions, we try to make it as seamless as possible on our end.  When it comes to handling your real estate closing, we do our very best to ensure that any issues that arise are handled promptly, professionally, and with as little hassle as possible.  At Arrowhead Title, Inc., our goal is simple.  We want to provide you with dynamic solutions to all aspects of your real estate transaction - from professional, accurate title services which protect your investment to escrow and settlement services which handle your funds with utmost integrity.  Let us conduct your real estate closing!

The Lake of the Ozarks' Most Trusted Title Company
Where Accuracy Matters!


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