In real estate, a closing signifies the end of a deal and is usually the official transfer of property. Sometimes things happen that cause the closing to be delayed. An unavoidable delay is one thing, but you’d be surprised how many choices people can make that affect their closing schedules.
Here are 5 things you can do as a buyer to make sure that your closing goes as planned:
1. Get your documents in as soon as possible.
It sounds easy enough, but it’s one of the most common reasons that closings are delayed. When you begin your home search, start collecting pay stubs, bank statements, and tax records so that you’re ready to send that information to a lender when you find a home.
2. Don’t apply for or take out new credit cards, auto or personal loans or have new credit inquiries in your credit bureau file during the course of your loan process and closing.
Requesting a credit score or opening up a new line of credit can impact your credit score, which can impact your monthly payment amount. If your lender runs a second credit report prior to closing and they see something new, it can raise a red flag and delay the closing.
3. Don’t make any large unverifiable and un-documented deposits or withdrawals to your checking or savings accounts.
See above. Lenders don’t like surprises or mystery money, so having a large sum of money appear or disappear from your account will also set off an alarm and could delay the closing.
4. Don’t quit or change employment.
When you start the mortgage process, you’ll be required to provide proof of steady income in the form of pay stubs. If you change jobs, you might be required to provide several pay stubs before you can proceed with closing, which can potentially mean delaying the closing by a full month.
5. Don’t write any insufficient funds checks (NSF).
It’s easy to understand why this is a bad move. Make sure you have enough money in your accounts to cover closing costs, pay any fees, and to continue living your daily life.
If you follow these steps, the chances of having a preventable delay in closing decrease drastically. By being fully prepared for the home buying and closing process, you’ll keep your closing on track.