What To Do When Faced With A Closing Issue
Closing means you're near the finish line, but unfortunately, just because you're closing doesn't mean the deal is sealed. There are a number of frustrating issues that can arise during this process. Even with this being said, make sure you understand that you still have legal rights. When presented with a challenge during closing, make sure you know what to do.
Before the deal is complete, the buyer is typically required to perform a title search. The purpose of this is to ensure there aren't any other owners of the property or that there is not a levy against the property. Once a clean title search is returned, you can obtain title insurance and move one step closer to being a homeowner. However, if your search revealed an issue with the title, you know just how big of a bump in the road this can be, but don't give up.
First, you are entitled to a further investigation. The terms of your deal will determine who is responsible for performing this investigation. The purpose of this is to ensure that there isn't a clerical or other error that is resulting in an issue with the title search. Secondly, don't let anyone tell you that the money you put in escrow is lost. Even if the title issue is found to be valid, your funds are protected.
Lower Than Expected Appraisal
Another part of the closing process is the appraisal. During this process, a professional will assess the value of the home you plan to purchase. The mortgage company will then compare this appraisal to the purchase price. If there is a significant difference, the mortgage company might be unwilling to provide funding for the full purchase price of the home. If you're already struggling to come up with your portion of the home buying costs, finding out that the bank won't give you as much money as you originally thought is devastating.
You have a legal right to have a second appraisal performed. In some cases, the first appraiser may have been under-qualified or didn't have all the necessary information to formulate a valid appraisal. If the second appraisal you have performed comes back with a higher value and this information can be validated, you should be in the clear and can continue with the closing process.
If you have been faced with a closing issue, a real estate attorney, such as John M. Ogden, can help you protect your rights and get closer to your dream of owning a home.