How is COVID-19 impacting closings?

If you weren’t able to take in the RI Realtors® YPN webinar on April 16th, you missed some important news about how COVID-19 is impacting closings. Attorneys Melissa D’Ellena, Chris Denelle and Geoff Sciotti had some interesting updates and advice to share. Here are some of their helpful tips:
• Early in the process, ask your sellers to dig out any paperwork they have on their properties (title policy, deeds, etc.) Not all information is online and providing the closing attorney with these documents, if available, could facilitate a faster closing.
• Notify the closing Attorney well in advance of closing if you have an out of state buyer. Buyers will be required to sign a form which will be recorded with the deed that states they will immediately quarantine for 14 days following the closing.
• Power of Attorney and mail away packages may take longer than usual and not all lenders are accepting them. Be sure to ask your clients early in the process if they plan to not attend the closing and communicate this to the closing attorney so procedures can be ironed out in advance.
• Be aware that closings are taking between two and three hours so make sure you are telling your clients what to expect ahead of time. Attorneys are having to meet separately with buyers and sellers, so it is a less efficient process.
• DO NOT advise clients on the forbearance or deferment of their mortgage. Forbearance is most likely not a great option as there are a lot of 90-day balloon payments being offered. If someone can’t pay now, how will they pay an inflated bill in 90 days? Instead, suggest that they call their accountant and/or family attorney for advice. They must understand what they are agreeing to.
• Gap endorsements are allowing attorneys to fund and disburse proceeds. This is a huge risk on behalf of the title companies. Though this allows us to “act like” the closing happened on the closing day most closings are not being recorded for weeks after the closing. (This varies by town.)

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