Possible Types of Turbulence
The Buyer/Borrower:
- Does not tell the truth on the loan application
- Submits incorrect information to the lender
- Has recent late payments on credit report
- Found out about additional debt after loan application
- Borrower loses job
- Co-borrower loses job
- Income verification lower than what was stated on loan application
- Overtime income not allowed by underwriter for qualifying
- Applicant makes large purchase on credit before closing
- Illness, injury, divorce or other financial setback during escrow
- Lacks motivation
- Gift donor changes mind
- Cannot locate divorce decree
- Cannot locate petition or discharge of bankruptcy
- Cannot locate tax returns
- Cannot locate bank statements
- Difficulty in obtaining verification of rent
- Interest rate increases and borrower no longer qualifies
- Loan program changes with higher rates, points and fees
- Child support not disclosed on application
- Borrower is a foreign national
- Bankruptcy within the last two years
- Mortgage payment is double the previous housing payment
- Borrower/co-borrower does not have steady 2-year employment history
- Borrower brings in handwritten pay stubs
- Borrower switches to job requiring probation period just before closing
- Borrower switches to job from salary to 100% commission income
- Borrower/co-borrower/seller dies
- Family members or friends do not like the home buyer chooses
- Buyer is too picky about property in price range they can afford
- Buyer feels the house is misrepresented
- Veterans DD214 form not available
- Buyer has spent money needed for down payment and closing costs and comes up short at closing
- Buyer does not properly "paper trail" additional money that comes from gifts, loans, etc
- Does not bring cashier's check to title company for closing costs and down payment
The Seller:
- Loses motivation to sell (job transfer does not go through, reconciles marriage, etc)
- Cannot find a suitable replacement property
- Will not allow appraiser inside home
- Will not allow inspectors inside home in a timely manner
- Removes property from the premises the buyer believed was included
- Is unable to clear up liens against their Brevard County property - short on cash to close
- Did not own 100% of property as previously disclosed
- Thought getting partners signatures were "no problem," but they were
- Leaves town without giving anyone Power of Attorney
- Delays the projected move-out date
- Did not complete the repairs agreed to in contract
- Seller's home goes into foreclosure during escrow
- Misrepresents information about home & neighborhood to the buyer
- Does not disclose all hidden or unknown defects and they are subsequently discovered
- Builder miscalculates completion date of new home
- Builder has too many cost overruns
- Final inspection on new home does not pass
- Seller does not appear for closing and won't sign papers
The Realtor(s):
- Have no client control over buyers or sellers
- Delays access to property for inspection and appraisals
- Unfamiliar with their client's financial position -- do they have enough equity to sell, etc
- Does not get completed paperwork to the lender in time
- Inexperienced in this type of property transaction
- Takes unexpected time off during transaction and can't be reached
- Jerks around other parties to the transaction -- has huge ego
- Does not do sufficient homework on their clients or the property and wastes everyone's time
The Brevard Property:
- County will not approve septic system or well
- Termite report reveals substantial damage and seller is not willing to fix or repair
- Home was misrepresented as to size and condition
- Home is destroyed prior to closing
- Home not structurally sound
- Home is uninsurable for homeowners insurance
- Property incorrectly zoned
- Portion of home sits on neighbor's property
- Unique home and comparable properties for appraisal difficult to find
The Escrow/Title Company:
- Fails to notify lender/agents of unsigned or unreturned documents
- Fails to obtain information from beneficiaries, lien holders, insurance companies, or lenders in a timely manner
- Lets principals leave town without getting all necessary signatures
- Loses or incorrectly prepares paperwork
- Does not pass on valuable information quickly enough
- Does not coordinate well, so that many items can be done simultaneously
- Does not bend the rules on small problems
- Does not find liens or any title problems until the last minute
The Appraiser:
- Is not local and misunderstands the market
- Is too busy to complete the appraisal on schedule
- No comparable sales are available
- Is not on the lender's "approved list"
- Makes important mistakes on appraisal and brings in value too low
- Lender requires a second or "review" appraisal
Inspectors:
- Pest inspectors too busy to schedule inspection when needed
- Pest inspectors too picky about condition of property, hoping to create work for them
- Home inspectors not available when needed
- Inspection reports alarm buyer and sale is cancelled
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