Closing on your home is arguably the most crucial part of the homebuying process. Without a smooth closing, your entire home purchase could be in jeopardy.
This article explains seven mistakes that can delay your closing and how you can prepare before signing the closing documents.
Common Closing Mistakes
While some closing mistakes may be out of your hands, it’s still important to understand which ones trip up most homeowners during the process. Here are seven of the most common mistakes when it comes to closings.
Incomplete or Inaccurate Documentation
Submitting incomplete or inaccurate documents to your lender can lead to delays when they review your loan application. Make sure you complete all required documents accurately and in a timely manner.
Any discrepancies or missing information might lead to additional requests for clarification or documentation which may delay the closing process.
Pre-approval gives you an estimate of how much you can borrow based on your financial information.
If you exceed this amount during the actual mortgage application or if your financial situation changes (lower credit score, higher debt, etc.), the lender might need to reassess your application, potentially causing delays or even a denied loan.
Throughout the home buying process, there are specific deadlines for various tasks like inspections, appraisals, and contingencies.
Failing to meet these deadlines can delay the closing. Work closely with your real estate agent to ensure you’re aware of these deadlines and can fulfill them on time.
An appraisal is conducted to determine the fair market value of the property. If the appraised value comes in lower than the purchase price, it can lead to negotiations between the buyer and seller.
If an agreement can’t be reached, the lender might not approve the mortgage for the original purchase price, potentially causing delays or even a canceled deal.
A title search is performed to ensure the property’s title is clear of any liens, disputes, or claims. If issues are found, such as unpaid taxes or unresolved ownership disputes, they must be addressed before the closing can proceed.
Unresolved Inspection Concerns
Home inspections can uncover issues that need to be addressed before the sale can close. Negotiations between the buyer and seller over repairs or adjustments can extend the timeline.
Additionally, some issues might require further evaluation, leading to delays while awaiting expert opinions.
The lender’s underwriting process involves reviewing your financial information and the property’s value.
Delays can occur if the lender needs additional documentation, has a high volume of applications, or if changes occur in underwriting guidelines.
It’s important to maintain open communication with your lender and provide any requested information to avoid unnecessary delays.
Having a successful closing allows you to have a smooth transfer of ownership to you from the seller. Keeping these common mistakes in mind, you’ll be prepared for the journey ahead.
Are you looking for a real estate agent in Massapequa? The Kim Holland Homes team is the #1 real estate team on Long Island. Contact us or call Kim today at 516-236-6303 to start the process of finding your dream home.