Always, always, always check your Buyer’s estimated closing statement.
Why?
First, you have to understand what a Buyer’s estimated closing statement is. It’s a piece of paper that shows escrow’s calculation of how much money needs to come in from the buyer to get the deal closed.
But wait, you ask, why do we need calculations? Surely the price is the price. Not so. There are all kinds of fees (for escrow, title, etc.), prorations for money paid or received by the Seller (property taxes, rent), and credits or debit (tenant security deposits, the Buyer’s initial deposit, etc.).
All of those adjustments cause the actual amount of money the Buyer needs to wire in to move around.
And, because escrow officers are human beings trying to juggle multiple deals at the same time, the calculations are often screwed up.
These aren’t tiny discrepancies. Among other instances, I once had escrow overpay me by $10,000 on a sale. Yesterday, on the other hand, we caught an error where we were being under-credited by $1,100.
Now, you may think that, in the context of a $3MM deal, $1,100 is not a lot of money. But our whole business is premised on the idea that we treat our investors’ money as if it were our own. And I don’t spend my days lighting $1,100 on fire, so I’m checking my closing statements.
And you should, too.