The Relevance of the Closing Date

Here in Tennessee, Line 142 of the standard Purchase and sale Agreement reads:

“A. Closing Date: This agreement shall be closed (Evidenced by delivery of warranty deed and payment of purchase price), and this agreement shall expire, at 11:59 P.M. local time on the ___ day of  ____________, _____ (“Closing Date”), or on such earlier date as may be agreed to by the parties in writing.”

This “closing date” is one of the most important terms of the contract to both the Buyer and Seller. The Buyer has great angst and anticipation and excitement associated with the move . . . as does the Seller.

Buyer and Seller are BOTH turning a page in their lives . . . a VERY significant page . . . as they pull their roots from one place and move to another.

I’ve heard the statistic that as many as 42 people are involved in the typical real estate transaction – Loan originators, processors, underwriters, appraisers, inspectors, Termite Companies, Title companies, Real Estate Professionals etc.

I’m a believer that each of these 42 people should have ONE thing on their mind when they agree to play a part in the process of consummating this transaction between the Buyer and the Seller . . . That one thing is a commitment to meet the closing date.

I say if you’re not willing to whatever it takes to meet (or beat) the closing date, don’t accept the responsibility.

I cannot think of a SINGLE valid reason (other than death, natural disaster, act of God) for a deal to get within a week of closing and be delayed.

I say again . . . When you agree to the date, you MUST solemnly swear that you are accepting the responsibility of honoring this closing date and this responsibility is to the BUYER and SELLER who are both packing everything they own into trucks and turning their lives upside down . . . and providing YOU a job.

What’s complex about this?

NO TOLERANCE!

I do hear excuses . . . couldn’t get the appraisal in time . . . credit blips discovered at the last minute . . . too many refinance loans in the lender’s pipeline clogging the system . . . Repairs not completed in time . . . Failure to order Termite letters or inspections . . . and the list goes on.

Folks, we are ALL busy, right?

Are we so busy that we can justify the turmoil that is created in the lives of the Buyers and Sellers (without whom the deal wouldn’t exist) when we fail to meet the closing date?

My practice is a “First 10 Day – Last 10 Day” routine.

For the first 10 days after the Binding agreement date, I make contact with EVERY person involved in the transaction EVERY business day to ensure that EVERYTHING is complete per the contract in terms of inspections, completed documentation, appraisals ordered . . . every i dotted and every t crossed.

Then I flow along with weekly contact.

10 days prior to the closing date, i go back to the DAILY contact with the sole purpose of getting a settlement statement (approved by the lender) in my hands at LEAST 48 hours prior to closing.

My batting average is darn good with this first 10/Last 10 routine because most of the vendors I work with know that I am going to be in their face every day until the deal is done.

So here’s my message . . . If you accept ANY “job” relating to a real estate transaction, your responsibility is to the CLIENT to perform said job not only thoroughly with just the right mix of “feel good” but also ON TIME.

Do I sound like I’m yelling atcha?

Well . . . I’m only yelling atcha if the shoe fits.

and if you’re doing business with people who are not all that concerned with the closing date, I would venture to say that you might consider developing some new vendor relationships.

I’m just sayin’

Best,

b

This post comes on the tail end of me (As Principal Broker) observing several recent deals with completely unecessary delays to the degree that one of my associates asked me: “why do we even write in closing dates? Because the lenders don’t even pay attention to them.”

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About Barry Owen

Residential Real Estate Principal Broker and Founder of Pareto Realty, LLC. Creating the quintessential real estate firm with emphasis on "Live, Work, & Play" balance . . . and a true Performance Oriented environment for Real Estate Professionals. Serving the Real estate needs of Home Buyers and Sellers in Middle Tennessee.
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