Reaching an accepted offer on a property is a moment of pure excitement. The most difficult part seems to be over, but the journey from "under contrac
Reaching an accepted offer on a property is a moment of pure excitement. The most difficult part seems to be over, but the journey from “under contract” to “closed” is a critical period filled with potential hurdles. This phase involves finalizing financing, conducting inspections, and verifying legal ownership. Unfortunately, it is also where many transactions fall apart due to unexpected complications. With foresight and a proactive approach, however, both buyers and sellers can navigate this period smoothly. Understanding the roles of key professionals, from a reputable roofing company for assessing the property’s physical condition to a diligent lawyer for clearing the title, is essential in identifying and resolving potential issues before they become catastrophic deal breakers.
The Financing Hurdle: Securing Your Funds
One of the most common reasons a real estate deal collapses is the buyer’s financing falling through at the last minute. This often comes as a shock to both parties. A lender’s pre-qualification is not a guarantee of funding. In the weeks leading up to closing, the lender performs a final, thorough review of the buyer’s financial situation. A sudden drop in credit score, a change in employment status, or taking on significant new debt—like financing a car or new furniture—can result in the lender revoking the loan commitment, instantly killing the deal.
Buyers can avoid this devastating outcome by protecting their financial status after pre-approval. They should not make major purchases, open new credit lines, or change jobs without first talking to their lender. Sellers also have a defence. They should work with their agent to carefully vet a buyer’s finances from the beginning. A full, underwritten pre-approval letter is far more reliable than a simple pre-qualification letter. This key document shows a buyer’s true ability to close the deal and significantly reduces the risk of financing failure.
The Appraisal Gap: When Value Doesn’t Match Price
In a competitive market, it is not uncommon for the agreed-upon purchase price to be higher than the home’s appraised value. When this happens, it creates an “appraisal gap.” A lender will only finance a mortgage based on the official appraised value of the property, not the contract price. For example, if a home is under contract for $550,000 but appraises for only $530,000, the lender will only finance a loan based on the $530,000 value. This leaves a $20,000 shortfall that must be addressed, and if it cannot be resolved, it becomes one of the most frustrating deal breakers.
When an appraisal gap occurs, there are several ways forward. The buyer can bring additional cash to the closing table to cover the difference. Alternatively, the seller can agree to lower the purchase price to match the appraised value. A third option is for both parties to negotiate and meet somewhere in the middle. If no agreement can be reached, the buyer may be able to exit the contract if they have an appraisal contingency in place. Sellers can be proactive by providing the appraiser with a detailed list of recent upgrades and relevant comparable sales in the neighbourhood that support the higher contract price.
The Inspection Surprise: Uncovering Hidden Problems
A home inspection is designed to protect the buyer by uncovering hidden defects, but a report revealing significant, unexpected issues can quickly turn a dream home into a source of conflict. Problems with major systems like the foundation, electrical, or plumbing can lead to intense negotiations. Among the most serious of these discoveries are roof problems. A faulty roof is not just an expensive fix; it can cause secondary damage from leaks, lead to mould growth, and make it incredibly difficult for the buyer to obtain the homeowner’s insurance required for their mortgage. These factors make a bad roof one of the most common deal breakers in real estate.
The best way to handle roof issues is with professional, proactive intervention. For sellers, the smartest move is to commission a pre-listing inspection from a certified roofing company. This allows them to identify and repair any problems on their own terms and budget before the house even hits the market. It prevents inspection surprises and demonstrates transparency to buyers. For buyers who receive an inspection report with roof issues, the first step is not to panic, but to get their own detailed quote from a roofer. This provides a realistic understanding of the costs involved, empowering them to negotiate effectively for repairs or a credit at closing.
Title and Ownership Issues: Clearing the Clouds
Before a sale can close, a title search is conducted to ensure the seller has the legal right to transfer ownership of the property. This search sometimes uncovers “clouds” on the title that must be cleared. These clouds can include outstanding liens from unpaid contractors or taxes, boundary disputes with neighbours, or even previously unknown heirs who may have a legal claim to the property. Any such issue prevents a clean transfer of the deed and will stop the closing process completely until it is resolved.
This is an area where legal professionals are indispensable. A real estate lawyer or title company works to identify and resolve these issues. The key to preventing delays is to start the title search as early as possible after the contract is signed. This provides adequate time to sort out any complications that may arise. Sellers can help by being fully transparent with their legal team about any potential issues from the start. For example, if there has been a recent death in the family or a divorce, ensuring all the necessary legal paperwork is in order can prevent significant and costly delays.
The Final Walk-Through: Last-Minute Discrepancies
The final walk-through is the buyer’s last chance to inspect the property. It is typically conducted 24 hours before closing. The walk-through has two main purposes. It confirms the home is in the same condition as when the offer was made. It also verifies that all agreed-upon repairs have been completed satisfactorily. Unfortunately, this final step can sometimes reveal new problems. A seller might have damaged the walls while moving out. An agreed-upon repair may have been done poorly or not at all. These last-minute discoveries can be infuriating. In some cases, they can even become last-minute deal breakers.
Clear communication and thorough documentation are the best ways to prevent these issues. Sellers should ensure qualified professionals complete all required repairs. They must then provide the buyer with receipts and any relevant warranties. Buyers, in turn, should conduct a meticulous walk-through. They should test appliances, check for new damage, and verify all repairs meet the agreed-upon standard. If any discrepancies are found, the buyer must raise them immediately with their agent. This allows time to negotiate a resolution before everyone arrives at the closing table. Avoiding these potential deal breakers ensures the final step is a celebration, not a confrontation.
From Contract to Keys: Your Roadmap to a Smooth Closing
The path from an accepted offer to a successful closing can feel like navigating a minefield. It does not have to be that way. While the process is complex, there are clear keys to success. These include proactive communication, thorough due diligence, and a commitment to addressing problems head-on. Never hope potential issues will simply disappear.
A great real estate agent, a diligent lender, and a meticulous home inspector are all invaluable members of your team. For major components like the roof, engaging a professional roofing company early is a smart investment for any seller or buyer. By staying engaged and working with trusted professionals, you can confidently navigate the hurdles. This ensures you arrive at the closing table prepared and ready to receive your new keys.
