The day has finally arrived, closing day! To say that the process of buying a house is a long one is a vast understatement. First, you spend week after week scouring the internet for new listings and then spend countless hours driving around to showings and checking out neighbourhoods. Then, finally, you breathe a sigh of relief when your offer is accepted but then find out the whole process is just starting. You then have to work through the inspection, appraisal, and title checks.
When you finally reach the closing table, the last thing you want to do is say something that could cause the deal not to go through or put a damper on the day.
Avoid saying these five things at all costs.
1. “I can’t wait to set up all my new furniture!”
Your lender wants to be sure that you are a safe risk to lend money to. When they set your interest rate and terms for your loan, they were working from the information that they had at that time.
If you went out right after that and put a bunch of new items on credit, this is going to affect your credit score. If your lender catches wind of this, they could rerun your information, which could cause your interest rate to go up.
2. “We are going to get started gutting the house right away.”
Saying something like this won’t hold up the process, but it could upset the seller. Most homeowners are attached to their house because they have fond memories. However, we actually found that sometimes sellers like seeing the transformation so it depends on the situation.
If you plan on gutting what they spent years building, it’s not something you need to boast about. If they ask you what your plans are after the sale of the property describe what projects you’ve done in the past. On the contrary, when you have no examples simply be honest and transparent.
3. Any last-minute changes you want to make to the house
Does the seller have a giant swing set in their backyard, and you don’t need it? Closing is not the time to ask them to tear it down or make any other changes.
Once you reach the closing table, make sure you go through the contract with the sellers. Sellers want to know you can be trusted and want to decide for themselves.
4. “I was shocked the house appraised for so much over the sale price.”
Once again, this information will not hold up your process at all, but it is unnecessary to mention. Sellers want a good deal on the house as much as the buyer does.
It’s exciting to find out that you will have more equity in the house than you thought you would. For this reason, be upfront with the seller and tell them how much they will make on the open market. Companies that buy houses aren’t always upfront. However, it is crucial that your honest with the seller and let them know how much you can offer. Again, transparency is the best policy. Sellers don’t always want top dollar because it requires more labour and additional work. As a buyer, you should help the seller by removing any obstacles in their way.
5. “I just quit my job” or “I just lost my job”
This is a major red flag to a lender that needs to trust that you will be able to repay your loan. Any significant changes can alter the lender’s ability to loan you money. You are even required to sign a document declaring that your job situation has not changed at some closings.
There is an old saying, “less is more,” that you want to follow when you are closing. The less you say, the better you will do. Do not disclose information you don’t need to, and consider how what you say will affect the seller. Keep in mind that closing day is an emotional day for all involved. As a buyer is it’s more common you will run into this problem when compared to companies that buy houses professionally. So make sure you are keep this tip in mind when talking to a lender.