What Could Cause a Delay in Closing When Selling Your Rural Vacant Land? (Part 1)

What Could Cause a Delay in Closing When Selling Your Rural Vacant Land? (Part 1)
Beth :
Hi, I’m Beth with TB Properties Buys Land. If you’ve ever bought or sold a home or bought or sold rural vacant land, one of the most aggravating things to find out is that your closing date has been extended, that it had to be delayed. Today we’re going to talk about some reasons why your closing date might be delayed. The first thing that I’m going to discuss is the title company itself. If you’re buying or selling in late spring, anytime in the summertime or early fall, these are the most difficult times to be trying to close quickly on a transaction. It’s just the busiest time of year for title companies. You think about it: the kids are out of school, it’s the time for everyone to be looking for a home. People are excited to be out buying land. So they’re really, really slammed. If you just add to that, like a sick title agent, then boom, it’s a great recipe for your closing date to be extended.

That’s just one of those things that might happen. A second reason I want to talk about that might delay your closing would be if you’re selling rural vacant land and your buyer needs a loan – they need financing in order to purchase your property. Depending on the location of your property and where they’re trying to find financing, and depending on where they’re getting this from, from a typical bank, or credit union, or another third party, private financier, it could take a long time to get financing. Most of the time closing agents are looking at 45, 60, sometimes even 90 days if someone’s sourcing financing for rural vacant land. It’s harder to find financing for rural land than it is a home. This is because they’re lending against dirt, it’s not a house where it’s easy to get an appraiser, an appraisal that’s already assessed. Things are already done and the house is easier to place a value.

The bank, or the credit union, or whoever’s financing the property, they’re going to need an appraiser out there most likely. Then you’re waiting on getting an appraiser to get out there. Appraisers are in short supply. You may be waiting for a long time, depending on the area where you’re at. If there are not a lot of appraisers, if they’re really, really busy, that could add time on top of the loan process. So the lender must wait on that appraisal to come in and then they can keep going with their part of the process. If you’re selling your land to somebody who’s sourcing a loan for that property, just understand that a 30 day close may not be likely. Understand that it’s most likely going to be delayed. You probably want to throw out 45 to 60 plus day closing date on there if you’re going to be selling it.

On top of this, the lender might even require you to get a survey. Surveyors seem to be even shorter supply than appraisers. So again, that’s going to take some time. And if a survey is required, most of the time you, as the seller are required to pay for that survey. Maybe you and your buyer can come to an agreement to split that 50/50. So I want to come back and talk to you a little bit more next week about surveys. And I’m going to give you a little bit of a case study when we were working with somebody whose property needed a survey before we could buy it from them. Even so, if you’re thinking about selling your property and you’re worried about closing delays and your transaction being extended, perhaps your buyer needing financing, I want you to understand that not all land investors or real estate investors are the same. Some do require loans.

And if you’re selling on the MLS, most likely whoever you’re selling to may end up needing a loan. Understand that an extension for the closing date can be a very real thing. Working with TB Properties Buys Land, we are land investors and we purchased property with cash and we purchase through a title company. That way there’s protection for both the seller, which is you and us, the buyer. They pull the paperwork, we know that everything’s done correctly and we pay for all closing costs. So if a survey is required, we’ll pay for that survey. We pay for any title costs, title insurance. We pay for all the escrow fees, the recording. If there’s an excise tax or transfer tax that’s required, we pay for that too.

So if you’re working with a company like TB Properties Buys Land, because we pay for cash, we can close a lot faster. Think two to three weeks. Busy seasons, maybe three to four, but we can close quickly. We pay for closing costs. So whatever value that we come to offer you and you accept is what you’re going to walk out the door with. And everything’s going to be done correctly, and you’re going to be safe by closing through a title company. So stay tuned. Next week, we’ll talk about a survey and other ways that your closing date could be extended. Thanks again for listening.
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