Whether you’re buying or selling a piece of real estate, it’s a big decision. The finances involved are usually significant and there’s a lot at stake. Often, real estate deals go through smoothly, but this isn’t always the case.
Sometimes, a buyer will try and back out of a sale. Outlined below are some of the more common reasons why.
When financing falls through
Mortgages are generally provisionally approved. This means that lenders agree to pay out the agreed sum based on the information they have at their disposal. If something goes wrong during this process, such as income being overestimated, then the loan can be removed, meaning that the deal ultimately falls through
Problems during home inspections
During a real estate deal, both buyer and seller will typically have people representing them. This includes surveyors, who are tasked with uncovering issues with the property. If the buyer’s surveyor finds faults that did not come up in other reports, this can throw a spanner in the works. Undisclosed structural issues or damages are one of the more common reasons that sellers back out of a deal.
As purchasing real estate is a legal transaction, it isn’t always as simple as just walking away from a deal. This is especially the case when contracts have been signed. One party may be obliged to honor the agreement or at least financially compensate the other for pulling away from the deal.
If you’re unsure about your rights during a real estate transaction, be sure to seek some legal guidance.