What if Sacramento Real Estate Sold and Closed in 3 Days?
What do you think would happen if you could buy a home in Sacramento and close within 3 days? Wouldn’t it be sorta cool if we could demonstrably alter the way Sacramento real estate is sold and buyers did all of their due diligence upfront, meaning they came to the table with an appraisal and underwriting approval? Back East, buyers often conduct a home inspection prior to contract ratification. This idea isn’t so far fetched.
You can buy just about any kind of product, even an illegal product from overseas, and receive it within 3 days. If you were to refinance a mortgage, that takes 30 days generally, but even when all is said and done and they are ready to close, that’s when they are required by law to ask a borrower: are you sure? Are you really, really sure you want this loan? Because we’re gonna give you 3 days to change your mind and rescind.
Yet in our neck of the woods to close escrow on a piece of Sacramento real estate, we enter into 30-day escrow periods, sometimes longer when underwriting is said to drags things out — but a delay is often not due to underwriting but because the mortgage loan officer (MLO) did not carefully scrutinize the loan application at inception or possess enough experience to predict the problem. I see some situations that never should have progressed to the point they made it to if the MLO had been more competent, but I digress.
Back to closing Sacramento real estate within 3 days. It would add certainty to transactions and definitely reduce the number of cancellations. Of course I’m looking at this solely from a seller’s perspective and how anxious sellers become when a purchase contract is signed, but then they go through 30 days of uncertainty and anxiety, never knowing whether the transaction will close. Buyers have 10 ways from Sunday to cancel a contract. They don’t even have to sneeze and trip over their own feet. They can just cancel.
Part of the reason home buyers cancel is because they’ve had too long to think about buying that home. Why, if they only had 3 days before they were in their new home, sitting back on the sofa and putting up their feet on the coffee table before the realization hit: What in the hell did we do? Well, it would be too late. For more thoughts, call Elizabeth Weintraub, Broker #00697006, at 916.233.6759.
How to Revoke a Cancellation When Buying a Home
Rarely does a buyer decide to revoke a cancellation when buying a home but it seems to happen enough lately. Makes me wonder if there is something in the water. One day the buyer is madly in love with the house; the next day, cold feet. They find some peculiar aspect of the situation to focus on, blow out of proportion, and the next thing you know, they execute a cancellation.
Always for silly insignificant things it seems. Then, for no known reason, they suddenly change their minds. Nope, they really DO want to buy the house, and they regret signing the cancellation. Fortunately, there are several ways to revoke a cancellation. The easiest solution is to sign an addendum agreeing to revoke the cancellation and pick up where the parties left off.
Usually, it is also wise to offer some kind of an incentive to the seller. Buyers need to look at the situation from the seller’s point of view to understand how upset, angry and annoyed sellers can get when buyers flip out and cancel a contract. Few sellers that I know have hearts so big they will overlook the irritation and agree to go back into contract. Especially if other buyers start to sniff around the home and make buying noises.
Sellers think: go with the devil I know, which irritated the hell outta me and whom I no longer trust? Or, go with new buyers who seem more promising?
Another way to revoke the cancellation is to write a new offer, clean and straight forward, perhaps with more favorable terms. That could restart the clock, most likely, with the loan. Whereas, with an addendum, if the cancellation was still wet, the closing period is generally shorter.
Either way, buyers may find they will need to sweeten the deal. Buyers need to persuade the seller to grant them another chance. Some of the things buyers can offer is to release the earnest money deposit to the seller. Little speaks louder than handing over non-refundable money. They can offer a higher sales price. They can release all contingencies.
Sometimes you have to make the seller an offer the seller cannot refuse.
HGTV: Cancel This Escrow
I’d like to see a new show on the cable network HGTV called “Cancel This Escrow.” They could film three different buyers during the escrow period — after the contract is signed but before the deal closes — and viewers could guess which one of them is likely to have cold feet and cancel this escrow. I mean, all three of them could threaten to walk away from a home closing, but only one of them actually will. Then we could listen to their excuses for buyer’s remorse and reasons to cancel this escrow:
- The palm tree tree in the back yard doesn’t have any flowers.
- The garage floor has four quarters divided by cracks.
- This house is painted brown, yuk.
- The street isn’t wide enough.
- One of the electrical outlets doesn’t work.
- It doesn’t have a built-in microwave.
- There’s no exhaust fan in the bathroom.
- I don’t like the way the light reflects on the ceiling fan blades.
- The garage door springs are missing a safety latch.
- Somebody left an empty can of paint on the roof.
While Elizabeth is on vacation, we are revisiting her favorite blogs from previous years.