50 Ways to Lose Your Buyer

When it comes to real estate, it’s easy to see how the term “high touch” can have a double meaning. Attorneys, accountants, escrow people, title folks, architects, pest control people, home inspectors, insurance agents, surveyors, contractors, electricians, plumbers, home warranty insurers, engineers, property managers, 1031 exchange accommodators, estate planners, wastewater engineers, even environmental engineers and land use planners get involved.

The Complex Nature of Real Estate Transactions

Buying or selling is rather like taking an airplane flight. Even the best pilots can’t guarantee a smooth ride. Market shifts and swings cause constant route changes. One lender cautioned me that the day will come when termite inspections and (probably) surveys will likely soon be required with every loan. For the past few years, these have mostly been negotiable. Prior to that, termite inspections were absolutely required.

Increasing Scrutiny and Verifications

Mortgage companies now independently re-verify jobs, income, credit, and even buyer identity just before funding. The days of large buyer credits and rebates have disappeared. Ever heard the adage that “buyers are liars”? Some say they have cash but don’t. Some have it and spend it, some say they are selling property to get their down payment but don’t consider that their pending divorce will delay everything indefinitely.

Challenges Faced by Buyers

Buyers change jobs or buy new cars right before closing. Some forget about child support liens or judgments that must be cleared. Sellers can be just as bad. They “forget” to tell their agents about title or ownership problems. Of course, permit problems are never good news. Home inspectors sometimes report problems inaccurately causing the buyer to re-think the entire purchase. No house is perfect, not even a new one.

Appraisal Issues

Appraisals can be a huge problem. Fall-out from a previous over-heated market caused rule changes related to how appraisals are ordered. Appraisers have new rules. Short value usually means no sale. Sellers (and their agents) who fail to adjust pricing to the current market probably start a chain of events that dooms a sale before it begins.

Common Pitfalls and Oversights

As unbelievable as it seems, REALTORS® still forget to pre-qualify their buyers (both financially and mentally). Some agents allow timelines to slip, putting the entire transaction in jeopardy. Surveys reveal set-back and encroachment issues, termite companies discover undisclosed damage, attorneys make errors on conveyance documents, and bumps in insurance rates affect buyer qualification even after loan approval. Even the lack of broadband service can spoil a sale.

The Role of Agents and Confidence

Agents must be problem solvers. Buyers and Sellers must have absolute confidence in their agent’s ability! Trust me, with so many things that could go wrong, fifty opportunities to keep a transaction on the right path may not be such a bad thing after all!