What Can Frustrate a Deal

May 16, 2016

This week we have a few things to watch out for that can frustrate a deal from Vaneesh Dass - Mortgage Broker of Verico Xeva Mortgage

What can Frustrate a Deal

Contracts:

• Adding the furniture to the contract
• Thinking that the cashback from the developer when added to the contract is not going to be deducted from the purchase price
• Dates
  • Completion of purchase and sale are the same date
  • Not setting a clear subject removal date and time so that the deadline isn’t missed
  • Client not having funds for the deposit, as they expect those funds from the sale.
• Not addressing the presence of potential underground tanks in properties
• Signatures not witnessed – not sure how strict lenders are on this now, TD used to be brutal for requiring it
• Incorrect page numbers
• PDS - client checks yes on a box relating to assessment or work done and then does not fill out the comments sections with info relating to the date, type of work and amount of assessment
• Purchase Plus Improvements Deal – Not getting more than 5 business days for subject removal – 7-10 preferred so contractor can get access for quotes
• Subject removal - On Saturday or Sunday, effectively gives you one or 2 less days as you have to get complete with lender Friday
• Not specifying purchase price is inclusive or exclusive of GST on new home purchase
• Blindly including a generic assignment clause, when the client has absolutely no intention of assigning
• Being inaccurate about age restrictions, who manages the strata, rental restrictions, rental pool – I’ve seen realtors call it a rental pool, when it wasn’t and it killed the deal with one lender
• Not adding the postal code to the address being purchased
• When another person is being added to contract later, not writing in the addendum including that person’s name
• Not letting the broker know that completion date has changed
• Not adding the other realtor’s information

MLS Listings:

• Comment referencing rain-screening or envelope work done years ago – automatically triggers the lender to ask for engineer’s report, proof of vote for full repair etc. I usually ask the Realtor for a new MLS with this removed
• MLS mentions property sold furnished
• Putting hobby farm in the description or pointing out income potential with the property
• Describing that the Realtor “thinks” the property might have been a past grow op.
• Unnecessarily pessimistic wording the notes, about the condition of the property – often makes lenders walk
• Being inaccurate on the financial data – don’t include the strata, property taxes, etc. if you don’t know – do your research!
• Not adding the property management company for condos/townhomes – the lender assumes it’s self-managed