3 Closing Mistakes in Longboat Key
Avoid These Costly Closing Mistakes in Longboat Key
Quick Answer
Three closing mistakes in Longboat Key can jeopardize your real estate deal: failing to secure proper insurance, overlooking condo association approvals, and misjudging appraisal values. Florida’s Office of Insurance Regulation mandates specific coverage, and missing this can lead to insurance denial, especially on barrier islands like Longboat Key. For example, I’ve seen buyers scramble when their insurance binder was denied just days before closing. Discovering these issues late can result in significant financial loss or even contract termination. Call me at 941.400.8735 or reach out directly to Michael Renick – I’ll share my approach with you.
What Actually Breaks Deals in Florida
Insurance Binding Failures
The problem arises when buyers fail to secure insurance well ahead of closing, especially crucial in coastal areas like Longboat Key. The Florida Office of Insurance Regulation requires specific coverage that can be challenging to obtain last minute. In one case, a buyer’s insurance binder was denied just three days before closing due to an oversight in flood zone requirements. This led to a forced renegotiation and nearly $10,000 in unexpected costs to secure alternative coverage.
We first met Eric when I requested more information about the apartment on Longboat Key. Eric’s response was the first one to hit my mailbox and the next day we were looking at the thoughtfully selected group of apartments. We were very impressed by Eric’s knowledge of the local real estate market and his professionalism. However, we didn’t buy anything at the time. With our permission, we’ve been added to the new inventory list and have been patiently waiting for our dream apartment. Six months later, Eric personally contacted me with the exciting news about the apartment that he felt would be perfect for us. Six weeks later, we were signing the papers in New York for our wonderful apartment on LBK. Eric was absolutely incredible during the negotiations and finalization process. He promptly responded to every single question or request we had. I’m recommending Eric to all our friends interested in purchasing a property in Sarasota area. Thank you, Eric!!!!
– delmanh, Zillow Review
Condo Association Approval Delays
Condo associations in Florida, governed by statutes like Chapter 718, have the power to approve or deny potential buyers. During one transaction, the estoppel certificate revealed pending assessments that the buyer was unaware of, causing a delay in approval. This delay pushed the closing date, resulting in additional temporary housing costs for the buyer.
Appraisal Gaps
Appraisal issues often surface when the property’s appraised value falls short of the agreed purchase price. Florida lenders require appraisals to ensure loan security, and a gap can lead to a deal collapse. In a recent deal, the appraisal came in $30,000 below the purchase price, forcing the buyer to either renegotiate or bring extra cash to the table, risking their deposit if they failed to do so.
Where It Usually Blows Up
These issues typically surface during the final stages of the transaction, often just days before closing. This timing is brutal because buyers and sellers have already invested time and money into the process, and any delay or renegotiation can lead to significant financial strain. When these problems arise late, buyers may lose their deposits, face unexpected costs, or even see the entire deal fall apart.
What I Tell Clients Before They Risk Money
- Secure Insurance Early: Start the insurance process as soon as your offer is accepted to avoid last-minute denials.
- Understand Condo Rules: Review condo association documents and seek approval early to prevent closing delays.
- Prepare for Appraisal Gaps: Have a financial buffer or plan to renegotiate if the appraisal comes in low.
- Check Flood Zones: Verify flood zone requirements and insurance needs specific to Longboat Key.
- Review Estoppels: Ensure all condo fees and assessments are disclosed and understood before closing.
Let’s continue this conversation.
Call me at 941.400.8735 or schedule a 15-minute call. I’ll tell you what I would look for.
Call 941.400.8735 or Schedule a Call
Questions Clients Actually Ask
What if my insurance is denied at the last minute?
If your insurance is denied close to closing, you risk delaying the deal or losing your deposit. It’s crucial to work with an agent familiar with Florida’s coastal insurance requirements to secure coverage early.
How do condo approvals affect my closing?
Condo approvals are governed by Florida Statute 718, and delays can push back your closing date. This can lead to additional costs and potential contract termination if not resolved promptly.
What happens if the appraisal is too low?
A low appraisal can lead to a financing shortfall, requiring you to bring in additional cash or renegotiate the purchase price. Without resolution, you risk losing your deposit or the entire deal.
What To Do Right Now
Review your insurance options and start the approval process as soon as your offer is accepted.
Mike and Eric provide exceptional personal service and guidance throughout the process of buying or selling your home. They make it as painless as possible! I both bought a home and sold a home through them.
– betsey roberts, Google Review
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