Homebuyers and sellers rely on their realtor to manage the complications associated with this major transaction. As you represent your client as a real estate agent, you must ensure that closing goes smoothly and help prevent unexpected snags.
Familiarize yourself with the common legal issues that can impact a client’s real estate closing.
Without a clear title, a real estate sale cannot move forward. Issues that can affect the property’s title include outstanding contractor liens, pending divorce or bankruptcy, or unpaid taxes on the home. Realtors can work with a real estate attorney to help clear potential title issues before closing.
A buyer must receive the closing disclosure from his or her lender and sign it no more than three days before closing. Failure to get this signature can result in a delay, so make sure all parties are aware of the deadline.
Errors or incorrect information on a mortgage application or supporting documentation can cause a buyer to lose financing before the sale goes through. Another common issue occurs when the home’s appraisal comes in lower than the mortgage amount, which requires the buyer to bring money to the table to complete the sale.
If the home inspection reveals serious problems with the property, the deal may fail unless the buyer and seller can successfully negotiate a compromise. Real estate agents can help their clients come up with a workable solution or decide when to walk away.
Preparing for these four possible legal issues can improve the chances that your client will have an issue-free closing.