With pre construction projects typically taking years to complete, it’s not uncommon for people’s circumstances to change. A buyer may not be able to close on their pre construction for a variety of reasons. Perhaps they are unable to secure financing or other personal circumstances may have gotten in the way of seeing the deal through. Regardless of why a buyer can’t close on their pre construction, as per the agreement of purchase and sale, they are legally obligated to close on the property.
If you can’t close on your pre construction you could face some steep consequences from the builder. So, we’ve come up with a list of 3 things you can consider to get out of the deal or help you close.
Find a co-signer
Getting someone to co-sign your pre construction deal has many advantages, especially when you can’t close on your pre construction. Having an additional person on the deal can increase your chances of qualifying for a loan and closing the deal. Which you otherwise would not have been able to do on your own.
Take out a private mortgage
Getting a private mortgage is another option to consider if you can’t close on your pre construction. Some benefits of this are that the approval process is shorter, it’s easier to qualify, and you are not required to pass a stress test. However, you should also be aware that private mortgages come with higher interest rates, extra fees, and a shorter timeframe to pay back the loan.
Assign your purchase agreement
Selling your agreement as an assignment is another way to get out of the deal when you can’t close on your pre construction. This is when the original buyer sells their contract to someone else, transferring ownership and responsibility of the property before closing. Assignment sales are tricky transactions. Many developers have stringent guidelines on how to advertise your unit and require approval before making the sale. Typically, there is also an assignment fee, as well as other fees, for performing the transaction.
This is where working with experienced and specialized agents is very important. Given the complex nature of assignment sales, it’s best to work with experienced agents who can walk you through the process step by step.
Need to assign your pre construction?
If you have a unit you need to assign, our team of qualified real estate agents at Haüskey will be happy to help you out!