WHAT CAN GO WRONG

WHAT CAN GO WRONG?

It is the wise client that prepares for problems before they happen! I also believe in this concept for my business! For this reason I would like to share my problem checklist that keeps me busy every day. Since no escrow is closed until it is closed, the following items are our potential roadblocks.

With over 17 years of experience and over 1000 successful monitored closings have armed me with the tools to overcome each and every problem encountered here, however, it would be unfair for me to say that every problem can be solved. I have placed a delay of closing estimate next to each problem and the ones with asterisks (*) are potential deal killers.

Here we go:

LENDER: DELAY:

1. Lender does not properly pre-qualify borrower. 2 weeks or *

2. Lender decides last minute they don't like borrower. 2 weeks or*

3. Lender decides last minute they don't like the property. 2 weeks or *

4. Lender wants property repaired or cleaned prior to close. 1 to 3 weeks

5. Lender raises rates, points, or costs. 2 weeks or *

6. Borrower does not qualify because of a late addition of information. 2 weeks or *

7. Lender requires, last minute, a re‑appraisal. 2 weeks or *

8. The borrower does not like the fine print in the loan documents 3 days or *
that we receive 3 days before close.

9. Lender loses file. 1 to 3 weeks

10. The lender does not simultaneously ask for information from the 1 to 4 weeks
from the buyer, they ask for information in bits and pieces.

THE COOPERATIVE AGENT

DELAY:

1. Won't return phone calls. 1 to 3 weeks

2. Transfers to another office. 1 week

3. Did not pre-qualify the client for motivation. 2 weeks or *

4. Goes on vacation and leaves no one to handle file. 1 to 4 weeks

5. Does not understand or lacks experience in real estate. 1 week or *

6. Poor people skills with buyer. 1 to 3 weeks

7. Gets client upset over minor points. 1 to 3 weeks

8. Does not communicate with their client well. 1 to 4 weeks

THE BUYERS:

1. Did not tell the truth on loan application. 1 week or *

2. Did not tell the truth to their agent. 1 week or *

3. Submits incorrect tax returns to lender. 4 weeks or *

4. Lacks motivation. 1 week or *

5. Source of down payment changes. 1 week or *

6. Family members do not like purchase. 1 week or *

7. Is too picky regarding condition. 1 week or *

8. Finds another property that is a better deal. 1 week or *

9. They are "nibblers" (Always negotiating) 1 week or *

10. The buyers bring an attorney into the picture. 2 weeks or *

11. They do not execute paperwork in a timely manner. 3 weeks or *

12. They do not deliver their money in a "check cleared" 1 to 2 weeks

fashion to the closing agent.

13. Job change, illness, divorce, or other financial setback. 3 weeks or *

14. Comes up short on money. 1 week or *

15. Does not obtain insurance in a timely manner. 1 to 4 weeks

ESCROW: DELAY:

1. Fails to notify agents of unsigned or unreturned documents so 1 week or *
that the agents can cure the problems relating to same.

2.     Fails to obtain information from beneficiaries, lien holders, title                           1 week or *
        lien holders, title companies, insurance companies, or lenders in a
        timely manner.

3. Lets principals leave town without getting all necessary signatures. 1 to 2 weeks

4.     Incorrect at interpreting or assuming aspects of the transaction and                    1 week or *
         then passing these items on to related parties such as lenders,
         attorneys, buyers and sellers.

5. Too busy. 1 to 3 weeks

6. Loses paperwork. 1 to 3 weeks

7. Incorrectly prepares paperwork. 1 to 3 weeks

8. Does not pass on valuable information fast enough. 1 to 4 weeks

9. Does not coordinate well so that many items can be done simultaneously. 1 to 4 weeks

ACTS OF GOD:

1. Earthquake, tornado, fire, slides, etc. 1 week or *

THE APPRAISAL:

1. The appraiser is not local and mis-understands the market. 1 to 3 weeks

2. No comparable sales available. 1 week or *

3. Appraiser delays (too busy, etc.) 1 to 3 weeks

4. Incorrect appraisal. 1 to 3 weeks

5. Appraisal too low. 1 week or *

INSPECTION COMPANY:

1. Too picky. 1 day or *

2. Scares buyer. 1 week or *

3. Infuriates seller. 1 week or *

4. Makes mistakes. 1 to 3 weeks

5. Delays report. 1 week or *

TITLE COMPANY:

1. Does not find liens or problems until last minute. 1 week or *

2. Does not bend rules on small problems. 1 to 3 weeks

3. Poor service. 1 to 3 weeks

4. Loses paperwork. 1 to 2 weeks

I appreciate the time you have spent to understand the challenging time between contract acceptance and close. I wanted you to understand these potential problems for the following reasons:

1. A transaction cannot close until escrow has cleared up any and all of the previously mentioned problems.

2. To let you know that I have great experience in heading off these potential pitfalls and thus can hopefully make you feel more secure in that you choose the correct broker.

3. To make these pitfalls clear to all the parties we are working with so that problems can be discovered early.

4. To make you aware of these pitfalls so that you can warn me of any potential problems.