It’s always a disappointing experience when you’ve put in an offer on a house and the buyer backs out. But according to a recent study, this is more common than you might think. In fact, nearly one-third of all home sales fall through. So what are the most common reasons that buyers back out of a sale?
Here are three reasons that top the list.
Financing Issues
One of the most common reasons that buyers back out of home sales is financing issues. Many buyers are not aware of the full range of financing options available to them, and as a result, they may not be able to secure the best possible deal.
In addition, some buyers may be reluctant to provide financial information to sellers or real estate agents. This can lead to misunderstandings and ultimately cause the deal to fall through.
Inspection Issues
One of the most common reasons that buyers back out of home sales is inspection issues. As part of the home-buying process, buyers have the opportunity to have the property inspected by a professional. Inspection contingencies allow buyers to renegotiate if there are issues. However, if the buyer is not satisfied with the results of the inspection, they may back out of the sale.
In some cases, buyers may be able to negotiate with the seller to make repairs or lower the purchase price. However, if the buyer is not satisfied with the terms of the negotiations, they may choose to walk away from the sale. Whether or not a buyer decides to purchase a home after an inspection contingency is often a matter of personal preference and depends on their tolerance for risk.
Low Appraisal
A low appraisal can be a major setback for homebuyers. After all, the appraised value of a home is often used to determine the loan amount that a buyer can qualify for. If the appraisal comes in below the purchase price, the buyer may need to come up with additional cash to close the deal. In some cases, the buyer may even back out of the sale altogether. There are a number of reasons why an appraisal may come in low.
The most common reason is that the appraiser simply underestimated the value of the property. This can happen if the appraiser is not familiar with the local market or if there have been recent changes in the market that he or she is not aware of. Another possibility is that the property being appraised is in need of repairs that the appraiser was not aware of. Whatever the reason, a low appraisal can be a significant obstacle for homebuyers.
Selling your home is not an easy task. It involves a ton of work and the truth is that a home sale can fall through at nearly any step of the process. By being aware of these three major reasons that home sales fall through, you can help increase your sale success rate.
Did you enjoy reading this article? Here’s more to read. Why You Should Start Planning Your Home Sale Early