|Why Might a Home Sale Fail to Occur?
QUESTION: What are the most common reasons a sale falls through?
ANSWER: Unfortunately, having a home sale fall through can happen. Of course, you don't want that to happen, but being aware of the common deal breakers can prepare you for the potential of this occurring and help you learn to work around the issues.
Low appraisals: If the appraisal comes back lower than the contract price, the deal could fall through. Your lender will only lend you money up to the property's value amount, so if the home appraisal is lower than the agreed amount, you cannot secure the full mortgage amount.
Title insurance surprises: Title insurance ensures that the home is the owners and can be sold. Lenders require title insurance to protect the home, so if the owner defaults on the loan, the faulty title will show that the home doesn't belong to the owner. To prevent any surprises, obtain your own title report.
Inspection issues: You have the potential to perform several types of inspections when you buy a home. It's important to note that every home will likely have some issue, but the primary reason for an inspection is to make sure the home doesn't have major deficiencies. Some red flags might include mold, roof leaks, foundation issues, and structural damage.
Keep in mind that when buying a home, there's a potential for the deal to fall through. While some of these issues are preventable, others are out of your control. Set realistic expectations so you can put yourself in a better situation if a deal falls through. If you have further questions about buying a home, reach out to a trusted real estate professional for more information.
Sources: Trulia.com, Zillow.com, Rochesterrealestateblog.com