What is more frustrating that having the sale of your home fall apart last minute? There are many reasons home sales fall through, such as: title-insurance surprises, buyer financing rejections, inspection failures, and lowball appraisals. Even buyer’s remorse can sour a deal.
The good thing is that people who are aware of these issues can easily prepare to avoid them or work around them. Once a buyer and seller agree on the general purchase terms such as price and timing, they still need to settle a slew of details and confirm key stipulations.
The truth is, almost anything can happen in escrow. Here are the 5 Reasons Home Sales Fall Through.
1. Buyer financing woes: It isn’t as easy to get loans since the housing market boom, be prepared.
- Look for preapproved buyers
- Make sure to follow up during the loan approval process
2. Low appraisals: The bank will only lend up to the appraised value, if buyers can’t make up the difference it is a deal breaker.
- Make sure you are prepared to lower selling price
- Offer your own appraisal to justify price
3. Plan for title insurance and home inspection surprises: Lenders require title insurance to protect their asset and secure the loan.
- Don’t wait for the buyer’s title report, get your own
- Same goes for home inspections
4. Watch for signs of buyer’s remorse: The entire home process is very emotional and people can get cold feet.
- Be wary of anxious and hesitant buyers.
- There isn’t much sellers can do to stop this, but always keep a lookout for signs.
5. Don’t hinge a deal on the buyer’s home sale: There are times that the buyer needs the equity from their current home to buy a new one
- Don’t allow a buyer’s sale be a contract contingency.
- Look for buyer’s who already moved or have down payment ready.