Once a home’s market status has changed to sale pending, it means the seller has agreed to the buyer’s offer. You can sigh in relief knowing both you and the other party are ready to reach a final decision. However, there are instances when a home sale falls through, even though all signs say otherwise. It’s not uncommon for real estate transactions to fail, even when the housing market is thriving. So, what is happening that causes pending sales to fizz out? The Jana Caudill Team explores a few of the biggest pitfalls that a pending sale encounters. Planning ahead can help you avoid these issues.
The Buyer Has Second Thoughts
When you’re anticipating a significant financial decision, it’s only natural to second guess yourself. Buyer’s remorse is a simple yet common reason that a sale is canceled. Buyers might feel pressured into making a final decision right away when they are given multiple offers, all of which may remain on the market for only several days. Certain contingencies in the buyer’s offer might give them time to walk away. But remember that it becomes more complicated after you sign the purchase agreement. Last-minute doubts are more than just frustrating—they may even involve legal disputes.
The Buyer Cannot Obtain Financing
Aside from those with significant wealth, the average person will need a mortgage to finance the purchase. However, some buyers cannot receive financing for any given reason. Typically, the buyer can get the money back if the loan is not approved and the offer contains a contingency regarding financing. Buyers may need to explore alternative means of financing, such as a bank statement-only loan.
The House Failed the Inspection
The house inspection is critical to a sale since it provides a detailed look into the property before making a final decision. When a house fails the inspection, it may mean the end of the road for the buyer. The buyer may be able to negotiate for repair work or step away from the purchase if there is an inspection contingency in the offer.
The Buyer Still Needs to Sell Their Current Home
Buyers can decide to add a home sale contingency to their offer. This contingency provides an opportunity to purchase the new home even if their current home isn’t sold at the time of closing. Either the purchase gets canceled or it gets postponed. Of course, the buyer can still complete the purchase by adjusting the closing dates to provide additional time or by getting a bridge loan.
The Purchase Price is Higher Than the Appraisal
Both the buyer and seller understand that a lender will request a home appraisal to confirm that the house is worth the financing value. If the appraisal is lower than the approved loan, buyers may feel unsure of whether to continue with the purchase, leading to second thoughts.
Speak to a Real Estate Agent
Whether you are buying or selling a home, working with a Real Estate Agent allows you to navigate any bumps in the road with the least amount of stress. The Jana Caudill Team offers the support you need. Contact our team to begin!