Real Estate Drama, It's Real and it's Usually Avoidable

Yes my friends drama loves to make an appearance in nearly every real estate transaction. But most of the time it can be avoided with a few simple rules. First of all expect the best but plan for the worst. All parties need to build in a cushion for the potential hiccups that can slow a transaction down. Don't be in such a hurry, things seem to take forever but then that last week and it's all, "Holy crap I'm outta time!"

Don't be "that guy." I have noticed that lenders are getting a bit faster at closing loans. The lack of inventory creates a slow down in sales and the interest rates are creeping up and that slows down the refinance business. This is a welcome condition having the loan done on time. There are however a great many hands stirring the pot of a real estate transaction. Any one of these many entities, the appraiser, the inspection, the moving company, title and escrow, etc. can have something come up that causes a delay in closing.

Try to build in a cushion, keep that rental unit for two weeks after closing. Now if there is a delay you still have a nice cushy 10 days to get moved. Seller's, negotiate a short 3-5 day rent back as a just in case, scenario. You may not have to utilize it but if there is a problem, you are covered on time. Remember that some transactions are like a set of dominoes each one falling and hitting the other in a chain reaction. One buyer is selling their house to buy another and that seller is buying another and so on and so forth. Just one of those transactions has a hiccup and all the others fall too.

It is always best to be safe!

Real Estate Deals are Like a Teenage Daughter

D-R-A-M-A. Yes friends it is a rare case indeed when the forces of the universe align and everything goes according to plan. The rest of the time a real estate deal feels like a full dose of a teenage daughter's first breakup.

The thing to understand is that real estate transactions are regulated by a series of Federal, State and local governments. The level of bureaucratic baloney is hard to fathom. Then one must consider the sheer number of individuals and companies involved in making a typical purchase money mortgage real estate transaction close. The lender, the closing agent, usually two different real estate offices, a property inspector, an appraiser and all of these are regulated at multiple levels of government.

Why am I mentioning this? Because buyers and sellers of real estate need to plan for the worst and take delight when things go better than planned. All too often people try to time everything to the day and it only takes one little glitch by one of the dozens of people involved in the deal to jam up the closing.

Don't give up your current place until you are certain your new deal is closing and always have at least two weeks of overlap. Yes, I know effectively a buyer is paying for two properties for two weeks, but most real estate deals end up with 40-60 days before the first new payment is due. So having two homes for two weeks is not so hard. It sure takes the edge off moving when you are not trying to move in a weekend.

Plan on having delays. Sometimes the stars align and the whole deal goes off without a hitch, but those are few and far between. No matter how good all the participants in the process are, everyone occasionally has the proverbial 'bad day' and that can lead to closing delays.

When buying a brand new home understand that sometimes builder run into delays. They could be due to a government regulatory action or problems with subs or materials. Don't worry, most real estate deals will involve a few hiccups, but proper planning will make every go smooth in the end.