You finally found the perfect home. You submitted a competitive offer, and the seller accepted! You’re well on your way to homeownership. Until suddenly, the deal falls apart.
It’s a disappointing and often frustrating experience, especially for those new to the real estate market. But it’s not uncommon. In fact, according to the National Association of Realtors (NAR), approximately 5–7% of real estate transactions fall through after the offer has been accepted.
So why do real estate deals fall through? And more importantly, how can buyers and sellers safeguard against these roadblocks?
In this comprehensive guide, we’ll explore the most common reasons offers collapse, real-world examples, expert insights, prevention tips and how working with a trusted real estate partner like Howard Hanna Real Estate Services can significantly reduce your risk
1. Financing Issues
One of the leading reasons a deal falls apart is because the buyer cannot secure a mortgage. This can happen if the buyer’s credit score changes, if they lose a job or other source of income or if the lender’s underwriting uncovers new issues. A high loan-to-value ratio can also derail financing. Even with a pre-approval letter, final mortgage approval can still be denied.
To prevent this, buyers should get pre-approved rather than pre-qualified, since pre-approval involves a more thorough review of finances. They should also avoid making major financial moves during the approval process, such as financing a car or opening new credit lines. Working with reliable mortgage professionals, such as Howard Hanna Mortgage Services, helps keep financing on track
2. Home Inspection Surprises
Home inspections often reveal issues that neither party was aware of, including structural damage, mold, plumbing or electrical problems or roof and foundation issues. These findings can lead to repair requests, renegotiations or even cause the buyer to walk away.
Sellers can prevent this by getting a pre-listing inspection to identify and address issues early. Both parties should stay reasonable during negotiations, and trusted Howard Hanna agents can guide clients through inspection reports and repair requests to ensure clarity and fairness.
If an inspection reveals problems, agents can connect clients with reputable contractors for estimates using their trusted local contacts.
3. Appraisal Discrepancies
If the property appraises for less than the offer price, lenders may refuse to approve the full loan amount. This creates a gap the buyer must either cover or renegotiate.
Sellers should work with experienced agents to price their homes accurately from the start. In some cases, an agent can challenge the appraisal. Buyers can also plan ahead by reserving funds in case of an appraisal gap.
4.Title Issues
A title search may reveal problems such as liens, boundary disputes or unknown heirs that cloud ownership of the property. These complications can delay or even derail closing.
Working with a professional title company is essential. Howard Hanna provides a one-stop shop to ensure that this process is seamless. Howard Hanna can ensure a clear title and expedites issue resolution.
5. Cold Feet or Emotional Decisions
Buying or selling a home is an emotional process, and sometimes one party gets cold feet. Fear, regret or second thoughts can cause them to back out of a deal.
Setting clear expectations and discussing motivations before entering into a contract helps prevent this. Leaning on an experienced Howard Hanna agent provides valuable perspective and level-headed advice. Staying focused on long-term goals can also help both parties stay grounded.
6. Contingency Clauses
Many contracts include contingencies for financing, inspection, appraisal, or home sales. If any of these conditions are not met, the deal may fall through.
Setting clear and realistic deadlines for all contingencies helps maintain momentum. Too many contingencies can make a contract fragile, so working with an agent to draft strong but fair clauses is key. Some buyers strengthen offers by removing low-risk contingencies, but they should always consult their agent to assess their comfort with risk.
7. Buyer’s Home Sale Falls Through
If the buyer is relying on the sale of their current home to fund the purchase, and that sale collapses, the new deal may also fall apart. Bridge financing can help buyers move forward without waiting for their existing sale to close.
8. Delays in Documentation or Deadlines
Real estate transactions involve large volumes of documents and tight timelines. A delay in signing, submitting or processing paperwork can throw off the schedule and cause a breach of contract. Staying organized and responding quickly to requests from agents, lenders or attorneys keeps things on track
9. Insurance Issues
Sometimes buyers cannot secure homeowner’s insurance due to property condition, location risks such as flood zones or claims history. Without insurance, mortgage approval is not possible. Starting the insurance application process early can prevent last-minute complications.
How to Protect Your Deal
Real estate deals are complex, but preparation and communication can make all the difference. Stay calm and patient. Keep in regular contact with your agent and lender. Expect the unexpected. Twists and turns are part of the process.
Using Howard Hanna’s one-stop services provides coordinated support through every stage, from mortgage pre-approval to closing day.
Ready to buy or sell with confidence? Contact Howard Hanna today and get started today.
Howard Hanna Real Estate Services proudly provides real estate, mortgage, title, and insurance services across 14 states. As the largest family-owned and -operated real estate brokerage in the United States, Howard Hanna operates more than 500 offices with 15,000 sales associates and staff. Recognized as the most innovative brokerage, Howard Hanna provides solution-based programs and platforms to empower their agents to provide more resources for homebuyers and home sellers, resulting in their agents achieving a sales success rate that is 53% higher than agents at the top 1000 brokerages nationally. Since 1957, Howard Hanna has helped agents build the skills and experience needed to thrive in the ever-changing landscape of real estate. Learn more at www.HowardHanna.com.
