This is our list of common problems that we deal with on a daily basis.
Things that can go wrong in real estate in Salt Lake City
THE BUYER:
1. Gets “buyer’s remorse” and loses excitement.
2. Was highest bid in a multiple offer situation, now thinks they overpaid
3. Gets pre-qualified, but not pre-approved. (know the difference)
4. Picked an internet lender, who is hard to reach or communicate with
5. Terms of the mortgage are not satisfactory and buyer backs out late
6. Takes advice from others, instead of an expert – “their own agent”
7. Has a co-borrower who ends up not qualifying
8. Does not tell the truth on his loan application
9. Has an unpaid judgment filed against them
10. Their income to debt changes before closing, now they don’t qualify
11. The buyers home sale fails, so they can’t close on this purchase
12. Interest rates go up, buyer did not lock the loan, can’t afford it now
13. Does not have a two-year work history with the same company
14. Opens a new credit card or new line of credit before closing
15. Has recent late payments on their credit report
16. Thinks the seller lied on the sellers property condition disclosures
17. Loses their job prior to the close of escrow
18. Changes jobs before close of escrow
19. Income is lower than what was stated on the loan application
20. Some income not allowed by underwriting (overtime, bonuses)
21. Makes a large purchase on credit before closing
22. Has a financial setback before closing (illness, divorce, accident)
23. Meets the neighbors and does not like them or what they have to say
24. After reviewing HOA docs, decides to back-out
25. Misses important deadlines in order for the loan to close
26. Was getting a money “gift” from a family member who now backs-out
27. Cannot locate their old divorce decree
28. Cannot locate tax returns
29. Cannot locate bank statements or other asset statements
30. Cannot locate bankruptcy discharge
31. Cannot verify rents paid
32. Mortgage payment is much greater than previous housing payment
33. Child support not disclosed on application
34. Has had a chapter 13 Bankruptcy within the last 4 years
35. Has had a Short sale within the last 2 years
36. Is uncompromising in negotiations
37. Switches from a salary or hourly job to one based on commissions
38. Does final walk-through on day of closing, not happy, refuses to sign
39. Feels the house was misrepresented by seller or the sellers agent
40. Loan program changes with higher rates, points or fees
41. Veterans DD214 not available or not eligible
42. Does not satisfy underwriting conditions in a timely manner
43. Does not qualify when underwriter reviews all the information
44. Does not have all the money necessary to close
45. Plans on renting the home, discovers the HOA rules do not allow it
46. Is self-employed, does not report enough income on taxes to qualify
THE SELLER:
47. Gets a better offer and sabotages the deal or fails to deal in good faith
48. Misrepresents information about the home
49. Rents the home, the renters refuse to vacate, so buyers can’t move-in
50. Renews the lease or takes on a new lease and deposits prior to closing
51. Needs more time to move than planned so buyers can’t move-in
52. Does not co-operate with inspectors or appraisers to access the home
53. Changes their mind and does not want to sell
54. Cannot find a home to buy and does not want to close until they do
55. Was selling due to job transfer, and now that opening is not available
56. Was selling due to divorce, but is now reconciling
57. Does not have the cash to clear up liens on the property
58. Does not disclose the correct property taxes, HOA fees, etc.
59. Elderly owner, not of sound mind, and without Power of Attorney
60. Property is owned by more than the one person who signed the listing
61. Refuses to make or pay for requested repairs after inspections
62. Makes repairs themselves and does not hire licensed contractors
63. Does some but not all of the agreed upon repairs
64. Moves out and does not remove trash or hazardous materials
65. Does not disclose defects and they are discovered prior to close
66. Does not make house payments and home goes into foreclosure
67. Borrows money against the home prior to close
68. Sells items in the home that were supposed to remain with the home
69. Dies or is hospitalized prior to closing
70. Does not vacate the property after closing (a holdover seller)
71. Removes property that the buyer believed was included in the sale
72. One of the spouses refuses to sell or sign the listing or closing docs
73. Movers reschedule, seller can’t get out, and buyers can’t move-in
74. Does not even own the property or have sole right to sell it
THE LENDER:
75. Only pre-qualified the buyer and did not pre-approve
76. Buyer is getting an FHA loan, but the home or area does not qualify
77. Is slow to ask for needed documentation from the buyer
78. The loan originator is new or inexperienced
79. The loan officer goes on vacation, the file is ignored until they return
80. Finds unsigned documents late in the process and requires extensions
81. Does not order appraisal in time to meet contract deadlines
82. Charges the buyers higher rates because their loan lock expired
83. Requires costly or unattainable flood insurance
84. Requires the property repairs to be completed prior to closing
85. The market rates or fees go up before they get a loan lock
86. Requires more down payment or closing costs to be paid by seller
87. Requires a last-minute, second appraisal or review appraisal
88. Puts off this file to focus on other deals
89. Does not ask for all important information from buyer upfront
90. Needs more time to complete the loan than estimated
91. Tells the buyer, no need to sell their home first, then later changes that
92. Does not fund the loan in time for the closing deadline
93. Fails to give loan approval prior to approval deadline
94. Gave an approval letter, then denies the loan 3 to 4 weeks later
95. Gives loan denial after lending deadline, buyers lost earnest money
96. Over-promises to get the loan, then under-produces, and can’t do it
THE APPRAISER:
97. Cannot schedule the appraisal right away, requiring extensions
98. Cannot complete the appraisal before the appraisal deadline
99. Cannot find comparable sales to justify the sales price
100. Appraises for less because home size was misrepresented
101. Is not local and does not know the area and the market
102. Is not on the lenders “approved list”
103. Makes mistakes on appraisal which cause the value to be too low
104. Requires a second inspection after repairs are completed
THE INSPECTORS:
105. Home inspector not available or reschedules, changing timelines
106. Inspections show presence of meth, mold or other health concerns
107. Radon tests come back at or above government recommendations
108. Pest inspector bills are high for pest mitigation (termites)
109. Discover a fence or outbuilding is over the property line
110. Find serious defects in foundation or other construction safety issues
111. Report shows need for other inspections (roof, HVAC, sprinklers, etc.)
112. Inspections cause buyer to ask for excessive seller paid concessions
113. Inspection reports alarm buyer into cancelling the sale
114. Report does not show problems, buyer finds after the close of escrow
115. Property is damaged by fire, weather, or renters prior to closing
THE TITLE AND ESCROW COMPANY:
116. Title policy has unknown or undisclosed defects or liens
117. Buyers or sellers leave town without getting all necessary signatures
118. Buyer or seller loses license or ID right before settlement
119. Fails to order payoffs or HOA docs early-on, delaying the closing
120. Title shows un-solved defects like easements or mechanics liens
121. Is inflexible when it comes to small problems
122. Does not coordinate well, many items can be done at the same time
123. Fails to notify the agents of unsigned or unreturned documents
124. Incorrectly prepares paperwork
125. Does not coordinate well with other title company in the transaction
126. Fails to get info from lien holders, insurance companies or lenders
127. Discovers liens or other title problems at the last minute
THE AGENTS:
128. Did not get all owners to sign listing, so the listing is un-enforceable
129. Did not verify if the home qualifies for an FHA or VA loan
130. Do not communicate that they are continuing to look at other homes
131. Did not disclose that the buyer has a home to sell in order to qualify
132. Do not communicate well with the other agents in the transaction
133. Do not get completed paperwork to the lender in a timely manner
134. Let their egos get in the way of good negotiations
135. Have no client control
136. Fail to get buyers earnest money deposited and cleared
137. Fail to verify the buyer has the funds to close
138. Failed to send all CC&R’s, Rules and Regs, prior to disclosure deadline
139. May be inexperienced and failed to qualify their clients
140. Unfamiliar with their client’s financial position
141. May not be familiar with this type of property or area
142. Does not return phone calls or email requests
143. Does not give access to property when needed or asked
144. Misleads the other parties in the transaction
145. Takes time off during the transaction and can’t be reached
146. Takes time-off, leaving their business with an agent who is unaware
147. Oversells their clients qualifications or cash to close
148. Gives bad advice during negotiations, valuations, repairs, etc.
149. Are adversarial to the other agents and difficult to work with
150. Does not know their client well enough and wastes everyone’s time