Dangers Of Transaction Closing Delays

There is a saying in real estate, “It isn’t over until it’s over”.  There are so many hurdles to making a transaction close successfully and on time.  Be very careful if your transaction does not close according to the terms of the mutually agreed upon purchase and sale agreement.  If that happens, technically the transaction is dead.  Hopefully both parties want the transaction to go through and it will not be a problem to get the closing date extended.  But, in a seller’s market, the seller may try to squeeze some concessions from the buyer (especially if the buyer, buyer’s lender, or buyer’s agent caused the delay).

Put yourself in the seller’s shoes.  If the closing date is extended by a week, the seller will have to pay more money for: utility bills, insurance, property taxes, and HOA dues.  They also have the stress of a vacant home that could have a fire, burst water pipe, or get vandalized.  Often, the purchase of their next home is contingent on the sale of their current home.  There is a good chance they will ask you to compensate them for these expenses and inconveniences.  Worse, with the hot real estate market we have, they may totally abandon your offer and transition to another offer (in a multiple offer situation).

If your lender or real estate agent is responsible for the transaction not closing on time, you might be able to get them to pay the seller demanded concessions.  But, obviously the ideal situation is to just close on time in the first place.