You’re almost there; you’ve done all of the work, and it’s finally time for the big show…closing day. Even with all of the bases covered, there are often times when a closing gets delayed. Today, the Highland Title & Escrow team wants to share some of the most common causes of delayed closings.
- The most common reason is…the lender isn’t ready to go to closing, but this isn’t always their fault. In talking with lenders and agents, we’ve discovered that the delay often comes when documents aren’t delivered in a timely manner. For example, a lender may ask a buyer for proof of employment. If that buyer takes a week to provide that document, the whole process gets slowed down. That proof of employment is then submitted to the underwriter, and if the underwriter needs an additional document, the whole process begins again. The time it takes to turn over required documents, whether it’s delivered in a timely manner or a delayed fashion, is a game changer.
This delay can easily be avoided by responding to requests quickly, checking in with the loan officer on a regular basis to see if anything additional is needed, and asking about the progress of your transaction. Being proactive and cooperative with lenders can keep things moving along.
- The final walk-through may cause a delay. If the air conditioner isn’t working or the dishwasher is broken, the buyer and seller will work together to resolve the issue before settlement.
This can be resolved by the seller paying for the repair or offering closing credits at settlement so the buyer can fix it on their own. The closing credit will need to be approved by the lender which could also cause a delay.
- The lender is also required to provide the buyer with a closing disclosure at least three days prior to settlement. If the disclosure isn’t provided three days prior, then the settlement is postponed until three days have passed. If the disclosure is provided the day before settlement, the settlement cannot take place the next day. All parties involved must wait three days before settlement occurs.
As a buyer, here is where it’s important to stay in touch with your lender. If the settlement is approaching and you haven’t heard anything regarding your closing disclosure, it’s reasonable to check in about a week prior to closing to ensure everything is moving forward.
- Appraisals can be another cause for delay in closing. If the appraisal was ordered late or if the appraisal comes back requiring the parties to revisit the sale price, these situations can cause a settlement date to be postponed. Even if the appraisal was waived by the buyer, the lender will require an appraisal so that delay can still be a possibility.
- Title issues do happen from time to time and become evident during a title search. Whether it’s an unreleased trust, an outstanding judgment or an IRS lien, the title company could uncover an issue that would prevent the seller from being able to convey marketable title by the settlement date.
At Highland Title & Escrow, our goal is to provide a smooth and seamless closing every time. When you are ready to close, please reach out to us at 703-723-3300, or contact us here! We look forward to working with