Okay, the tax credit boom is over, with April 30th slamming shut the window for prospective purchasers to get into contract. We saw an enormous boom in business in April as the credit wound down — at our real estate company, we had the biggest month in the 25-year history of the company, transacting three times the number of homes as April 2009. We expect that companies across the country had the same types of results.
Now, the question becomes what you need to do to get closed by June 30th if you want to claim the credit. One of the complications of all this is that real estate agents, at least in my area, are simply not used to juggling this many open (i.e., in contract) transactions and trying to get them all closed at once. Five years ago, they were more practiced at that, but most of them have not had the luxury of having multiple deals at a time during the slowdown in the market. So let’s make sure these contracts get to closing on time.
Here’s what you need to do:
- Communicate your situation. Make sure that everyone on your team — your agent, lender, attorney/escrow agent, engineer, and even the seller knows about your June 30th deadline. I would send out a blast email to everyone reminding them of everything that needs to be done by that time, and making sure they know you’re on a true hard deadline.
- Get Organized. Take out a piece of paper. Write down everything that has to be done to get you to close. Indeed, call all your professionals helping you and ask what they need to do, and when they need to do it, to get you to close. I’m a big believer in “checklists” as a means of ensuring attention to detail. This is the perfect time to execute a checklist of all the things that you need to do to get closed. Turn your checklist into a project plan that you’ll send to each of your professionals, and then stay on top of them to make sure they’re complying.
- Give yourself wiggle room. Don’t plan a closing the last two weeks of June. Try to schedule before that, so that you don’t end up losing your tax credit due to a last minute screwup. No matter how prepared you are, you’re going to run into problems somewhere along the line. So give yourself wiggle room
One way to avoid those types of last minute problems is to ask each of your professionals to identify things that could go wrong, so that you’re aware of them. If there are documents that sometimes are required at the last minute, go get them now. For example, it’s a great idea to gather all those old pay stubs, contact info for past employers, and everything else that your lender might be asking from you at the last minute.
If anyone else has other suggestions, I’d love to hear them.
