Homebuyer Tax Credits and slow closings.
As we all know, contracts must close by June 30, 2010 for the buyer to qualify for the tax credit.
At the same time, we know that some closings take longer than others, like short sales and bank owned properties. This delay may cause the closing to take place after the deadline, costing the buyer $6,500 or $8,000.
So if you have a buyer who is looking at a short sale property, you may want to warn them that the closing could be delayed past the deadline. You could even suggest a different property.
If they remain intent on buying the short sale property, then you should try to protect yourself. An easy way to do this is to have something in writing stating that you have warned them of the potential problem. This will keep you and REMAX out of hot water if and when the client tries to say you didn’t tell them this could happen. We already know how much they will want from you.
The properties showing the most delays are;
Short Sales
Bank owned REO (especially those that do not have a deed recorded yet.)
Condominiums
There are certainly others that will sound alarms for you, like property with tremendous amounts of work to be done, or estate sales. You just need to keep the dates in mind, and try to bring up the issue as early as possible so you can get the buyer to another property before the April 30th deadline.
ATTACHED is a sample form you could have the buyer sign showing you have advised them of the possible delayed closing.
Nick
