Weirdest Real Estate Situations

One thing I learned in the real estate industry is that no two deals are alike. You might be able to take all of the education courses in the world, but nothing will prepare you for the actual experience of being a real estate agent. There are so many different parties involved that any little detail can throw off the whole transaction and make it weird. But one thing is for certain: a great real estate agent understands how to negotiate and how to solve problems. Here are some funky and weird situations and what to do about them in the real estate world by actual real estate professionals.

This post is actual real estate scenarios not by AI.

1) Someone else is living in the property (and nobody mentioned it)

There's nothing like opening the door to a vacant housewith the lock box and key only to find that someone is actually living there. Or, you tour a bake at home, go under contract, and then during the final walk-through, you find evidence of somebody there. Maybe they're sleeping bags in the basement, a random tenant in the spare room, or even the current homeowner saying they have permission to stay.

Whatever the reason, this can definitely affect closing timelines, Insurance, financing, and even legal liabilities. Most buyers don't want the house if there's a current unknown occupant. So what can you do about this?

Rayo Irani, Oakville Ontario Real Estate Agent suggests, "The best solution is to confirm the legal occupancy status immediately. If the occupant is a tenant with the lease, they may have certain rights that the buyer was unaware of. Are they a squatter or a guest? Ask for written documentation such as a lease, rental Ledger, or even a key agreement."

Talk to the seller to deliver vacant possession. Add a contract amendment that requires vacancy by a specific date. This might also include a cure. And penalties such as holding back some of the closing costs, a daily rent-back fee, or a termination right.

The biggest thing is not to close, hoping it simply goes away, meaning the situation and the occupants. If the prophecy is not vacant when it should be, make sure you delay closing until it is or negotiate certain escrow funds that will cover any removal costs.

2) A surprise lien appears right before closing

Your title insurance is extremely important, but if the title work comes back clean and the days before closing, a lien pops up, such as a mechanics lien, a judgment comes up, or an unpaid Municipal Bill, it could be enough to break the seller's net proceeds. Buyers typically won't get a clear title until the lien is released, and lenders won't often release funds until it's resolved.

Sandy Jamison, The Jamison Team in Santa Clara, CA "The best course of action is to force a clear written payoff and release plan. The title company requests the payoff statement and confirms the release process and timeline. Buyers should use escrow to hold back any funds if timing is tight. If the payoff funds are available, but the release paperwork takes time. Buyers also want to verify that the lien is valid. Not all lien pop-ups are legit. Sometimes they are filed in error or could be a duplicate. Your title insurance can challenge or correct any misindexed records."

3) The appraisal comes in low for a weird reason

If the appraisal comes in low for some odd reason, the loan could be capped. This could mean that the appraiser missed a bedroom, ignored upgrades, or compared your home to a completely different neighborhood or house, and made a mistake. A low appraisal can force renegotiation or even kill the buyer's financing.

Wendy Kime of Kime Realty and Southeast Michigan Real Estate adds this solultion, "The best way to combat this is to submit a clean reconsideration of the value package. The agent will provide better comps, list factual errors, and include permits or receipts for any major improvements. Sellers and buyers will need to renegotiate, or the seller will provide a price reduction, the buyer can bring cash or split the Gap, or even restructure concessions. If timelines allow and the appraisal is clearly flawed, the buyer might need to order a new appraisal with a new lender. This may start the process all over again, but it can be done."

4) Inspection reveals something “not a defect” but still a big problem

We had an inspection that revealed not quite a defect but it was a deal breaker. The homeless structure is fine, but the inspection revealed a buried oil tank with no documentation. This was an unpermitted addition that looked fine on the outside but isn't necessarily legal. This might happen with a private well or septic system as well. These issues can create future resale risk, be an Insurance liability, or even offer restrictions from the lender. 

Marley Presswood, Daniel Island REALTOR offers her solution, "We dealt with this by pulling permits, locating prior approvals, ordering tank sweeps and soil tests, and got special inspections from Structural Engineers. There was remediation credit and seller correction or we would have to have reserved escrow for any future work. However, some of these issues can be financible with documentation While others cannot be. Don't guess, but go back to all parties involved and make sure everything is on the up and up before finalizing."

5) The seller won’t move out on time

We've had deals where the seller requests just a few extra days, and then of course it becomes a week, and then two, etc. They assume the buyer will allow them a post-closing occupancy without formal terms and that's just not the case. Once you close, you've handed over ownership. If the seller decides to stay without an agreement, the buyer now becomes a landlord. So what can they do?

Danny Varona of Bainbridge Island Real Estate says, "Make sure the closing date is clear, and both buyer and seller understand the requirements and expectations. If the seller is going to stay longer than closing, you'll want to use a written post-closing occupancy agreement that could include security deposits, insurance requirements, and a firm move-out date. Buyers can hold back money in escrow and have to cover any damages and ensure a timely vacancy. Be sure to do a pre-closing walkthrough and a post-move-out walkthrough, documenting all the conditions with photos and a checklist. This is not uncommon in a seller's market, but it does need to be written out and followed to the letter."

6) A “missing signature” appears after everyone thinks it’s done

A missing signature, which can definitely happen when there are 18,000 things to sign at closing. But, when buyers and sellers are at the finish line, and suddenly the company needs another signature from an ex-spouse, an error, a beneficiary, a kind of trustee, or a co-owner who wasn't engaged in the process, it can definitely slow down the closing. If the ownership over 30 is not complete, the seller may not legally be able to convey a clear title.

This is a pain, but it is mandatory. Alex Rivlin of the Rivlin Group, High Rises in Las Vegas says, "You'll want to confirm any Authority early on for any trusts, estates, divorces, LLCs and request documentation up front. Use remote notarization when possible or a mobile notary, especially if the missing signer is out of state. If necessary, you may need to escalate to an attorney for legal resolution."

7) The buyer’s financing changes at the last second

Financing can be a tricky thing, and it can change on a dime. I've seen buyers make huge purchases like buy a car or run up their credit cards at the last minute, or change jobs, quit, or be fired. Any of these things can drastically affect financing and could prevent closing. Underwriting is sensitive, and even small changes in finances can shift debt-to-income ratios, Reserve funds, or cause denial or delay.

I tell all of my buyers once you've locked in a rate, freeze all major spending. Don't open any new credit lines, don't make any major purchases, and don't change jobs until after closing. It's important to build a timeline buffer meaning don't schedule closing with zero margin if the loan is squeaking by. Consider having a secondary lender option or cosigner if necessary. If this happens in the middle and you do make major Financial changes, it could affect your interest rates, down payments, and even your ability to get the loan. Each situation is unique, so if this happens, we have to work it on a Case-by-case basis.

Odd situations definitely happen at least half the time but they don't have to kill a deal. A really great agent is one who finds solutions, negotiates through the situation, and communicates with all parties so that the deal can get done. Nobody wants to start all over, and nobody wants the deal to die.