How to avoid closing problems

A buyer and seller’s worse real estate nightmare are closing problems. The exciting day has come for a buyer to move into their new home. And, likewise, for the seller to move on as well.

Closing Problems

But several issues can come up before and during the day of closing. At times minor issues come up. Missing keys. Bad timing when it comes to schedule moving trucks or elevator bookings at condos. And other times, major issues arise. The buyer doesn’t get financing at the last minute. Or the new owners move into an absolute mess. Maybe even worse, the seller and all of their stuff is still there and it’s already 6 pm.

Closing problems can be avoided with a bit of foresight, managing expectations and problem solving. Here are a few things to keep in mind.

Expect closing problems to arise

Problems will arise. It’s part of the nature of the real estate transaction. To be proactive, real estate agents manage the expectations of their clients and tell them what to do to troubleshoot or overcome any situation.

The best solution, of course, is avoidance. But there are several things that will be out of your control. For example, if you’re selling a home and the buyer doesn’t get financing, what could you possibly do about it? And if you’ve bought a home, it will set off a chain of events that will affect your closing as well.

Your real estate agent will guide you through the various details of financing, moving, setting up utilities and settling into your new home. They will also help you should closing problems arise. Proactive agents will anticipate potential issues and work right away at resolving them. Make sure you work with an agent who is proactive, not reactive.

Choosing the day you close

Closings on the last day of the month, or the last Friday of the month, and especially on June 30th, are very popular. When many buyers and sellers close on this day, lawyers, lenders and moving companies deal with a much higher volume of closings than usual. Services can get expensive — for example, if you want to book a moving service on a very busy day, you may end up paying more for it.

The best thing to do is to close in the middle of the month, or any date that isn’t one of the busy days. This makes it a lot easier to deal with lawyers, your financing company and booking a mover or moving truck.

Buying and selling at the same time

If you’re selling a home and buying at the same time, closing on the same day could be challenging under several conditions. If the buyer of your home doesn’t get financing for whatever reason, what happens to the home you’re buying? This unfortunate incident would set off a series of events affecting sequential closings — basically anybody connected to the closing of your home and the other buyers and sellers homes. If one closing comes apart, several others can be affected.

Have a contingency plan if you are planning to buy and sell with a closing on the same day. In case your buyer doesn’t close, make sure you have a backup plan for financing to buy the home you’re supposed to move to. You should also have contingency plans for storage and accommodation, just in case.

Bridge loans are one solution to the financing problem in case you can’t close because your buyer doesn’t get financing done on time. Although it is not the ideal situation to be in, it is worth the time and expense.


More often than not, an appraisal will happen on your property to satisfy the buyer’s financing requirements. Mortgage lenders will order appraisals to make sure the home’s value is in line with their financing. As a homeowner and seller, make sure you understand and expect an appraisal to happen. Refusing an appraisal or ignoring it will be detrimental to the financing and eventual closing of your property.

Building permits

If you’re buying a new home, your lawyer should make sure there are no open or outstanding permits. They will make sure all permits are closed. This is very important because you do not want to run into any issues later on that may affect your enjoyment of your new home. Make sure you know what to expect when you’re buying a new home, and that you’re working with a lawyer who will ensure all work orders and permits are closed.

 Multiple offer financing

Multiple offers have become the norm especially with how the real estate market has been performing in recent years. In many cases, buyers make offers with no financing condition. In some situations, appraisals come in lower than the offer a buyer has made. If you are a buyer, you should have a contingency plan. More importantly, make sure you do not overbid for a home. Ask your real estate agent about the value of the home.

If you¬†do end up overpaying for a house and the appraisal comes in at less than the price you offered, you will have to make up the difference to cover the mortgage lender’s requirements.

Title, easements, right of way

Some homeowners no longer have original surveys that came with the property. As much as possible, you should try to get a survey if it is available. Look at the legal description of the property you’ve purchased and figure out what any title notations are. Your real estate agent and lawyer will help you with this.

Condo status certificate

If you’re buying a condo, make sure your real estate agent coordinates the ordering of a status certificate well in advance of closing. In fact, it should be done once a conditional offer has been accepted by the seller. Sellers typically order the status certificate at their expense and have 10 days to deliver it to your agent.

Once the status certificate is available, make sure you or your agent delivers it to the lawyer for review. Your lawyer will give you advice about their findings on the status certificate and whether or not the condo is in a good financial condition. They will also make you aware of any rules or by-laws that may be relevant to your enjoyment of the condo.

Parking and lockers

Make sure you inspect parking and locker spaces so you know what to expect. There is nothing worse than assuming what a parking space or locker ‘look like’ only to discover that your parking space is not in the best spot of the condo, or your locker is smaller than what you expected.

Keys and access

If you’re buying a house, keys are typically delivered on closing by your lawyer or your real estate agent. Make sure you have all the keys of the house. You may want to change the locks when you move in.

If you’ve purchased a condo, make sure you are given a complete set of keys and access fobs including garage door openers. There is nothing more disappointing than not having a complete set of keys and having to purchase replacements at cost.

Inform the property manager and security about your move. Your real estate agent will help you with this. That way, you can easily access the condo on the day you take possession and your access won’t be deactivated for whatever reason. In some cases, new condo owners are trying to move in but security won’t let them in because they haven’t officially registered as residents of the condo.

Inspections prior to closing

Make sure you book for visits or inspections prior to the day of closing. If there is something that needs to be addressed, it should be done well in advance. In some really bad cases, previous owners switch out good appliances with bad ones or leave the place in a complete mess. Make sure you and your real estate agent have a plan of action in case this is the situation you have to deal with.

Celebrate your closing day

Yes, it can (and will) be a stressful day with lots of work to do, closing problems that come up and who knows what else. At the same time, it’s an exciting day where you take possession of your new home. Amidst the busy-ness of the day of closing, make sure you take the time to enjoy and celebrate. After all, you’re about to move into your first home, or into your new one.

How to avoid closing problems

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