Closing escrow -- completing the deal to buy your house -- is a complex process, which requires signing a lot of papers, paying bills, transferring money from a buyer to a seller and finally recording the deed with the appropriate agency to show that the ownership has changed. It involves many steps, and even if you're paying cash, little things can hold up closing.
Parties Can't Meet
An escrow agent handles the actual closing, seeing to it that all the forms are properly signed and everything is order. The agent also normally schedules the closing, at a time convenient for both buyer and seller. If either buyer or seller can't keep the scheduled appointment, for any reason from traffic delays to illness, the closing will be delayed until another time.
Any error in paperwork will delay a closing. If the escrow agent finds, for instance, that names are spelled differently on different documents, the closing will be delayed until the question is resolved and the forms are corrected. This can even happen at the closing table, if one party's driver's license, for example, does not agree exactly with the name on the sales contract.
Problems with inspections often cause delays in closing. Even in a cash purchase, the house typically has termite, mechanical and other inspections to find any faults so they can be corrected before closing. If repairs are not completed by closing or if buyer and seller cannot agree on whether the corrections were completed properly, the agent will delay the closing.
Another common delay in escrow occurs when a title search turns up unexpected liens or claims, whether justified or not. The agent will delay the closing until any questions are resolved. There also can be questions about closing costs, either the amount or which party pays. Some costs can be paid by either buyer or seller and if they can't agree and get them paid, the closing will be delayed.
The best way to close on time is for both buyer and seller to eliminate any surprises. Both buyer and seller should carefully review the settlement statement before the actual closing. It lists all the closing items and costs, who is to pay and who is to perform any duties. If buyer and seller agree on the settlement statement, the closing should move promptly.
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- What to Expect When You're in Escrow
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- What Are the Steps in Closing on a House?