Published on: Jan 19, 2016 12:35:31
New buyers to the housing market do not always realize that to buy a home means competing with other interested parties. Placing a contract on a property is one phase in the process. Taking steps to avoid failure of escrow is paramount to ensure the sale goes through. Hiring a real estate professional is an insurance policy against this scenario. Here are three tips with insights to help navigate possible issues.
Each state has real estate laws to adhere to and specific forms to complete. They protect buyer’s by giving them time to exercise due diligence while providing full disclosure. The buyer is afforded the right to walk away for a variety of reasons. For example, if the inspection reveals needed repairs or structural deficiencies, the escrow will fail.
The disclosure form is another example that buyers review that may raise concerns negating the deal. These scenarios show the importance of enlisting the expertise of a real estate agent. Knowing the conditions of each MLS listing, the value of comps for the area, and the ability to negotiate are other critical skills they bring to the table.
The financials of the deal can also prevent the closing. To buy a home, individuals have obligations and responsibilities beyond down payments. One accounting sticking point is confirmation of the critical pre-qualification of the buyer before contracts are made. Rejection by banks means there are no funds to make the purchase. Next, buyers will also need to refrain from any new credit activity until after the closing to avoid moving the debt-to-income ratio numbers.
Finally, there is the issue concerning appraised value that differs from the bank’s figures and the outside contractor. The discrepancy would be cause for sellers to rebuff the offer. While this is often out of the hands of the buyer, it has a direct impact on a successful deal. The real estate agent will be aware of these risks and can give advice to prevent them.
Being cognizant of contingencies is another critical factor that can cause the real estate transaction to fail. A contingency would be repairs made by a certain date or sellers closing on a new home before selling the old one. The experienced real estate agent has the knowledge to write contingencies and review them with buyers. They can monitor deadlines and manage communications to avoid complex problems. Those in the market to buy a home need this expertise to verify that conditions are met to mitigate any surprises.
Real estate transactions have many moving parts with several professionals involved in the process. This includes attorneys, bankers, and real estate agents and brokers. Buyers should be clear that partnering with firms who can meet the demands is as important as finding the perfect MLS listing.