sale falls through on house

What Happens When a Sale Offer Falls Through on Your House?

How a Home Sale Can Fall Through

An interested buyer does not always mean a sure sale, and there are many factors that can contribute to the sale of a property not reaching its conclusion.

In this article, we’ll be looking at some things that sellers should take note of in order to prevent an enthusiastic buyer becoming lukewarm about buying a property.

Various Buyer Contingency Clauses 

Selling a home typically comes with quite a bit of admin, and many documents that ultimately confirm the sale. You real estate agent will be of great assistance here, helping you in these detailed endeavours.

The process of starting the transfer of legal ownership kicks off when an offer on a property is accepted. The buyer and seller will both sign a contract confirming that the property is no longer on the market (or “for sale”), and letting other interested parties know that the seller has found a buyer. The property’s status in the market has changed, as the buyer and seller are in the process of closing the deal on said property. The property is now “in contract” or “under contract”, before officially being sold to the new owner.

A number of contingency clauses may be written into this contract by buyers and sellers, allowing them to withdraw from the sale under certain, pre-stipulated conditions. Some examples of contingency clauses may include:

  • Appraisal contingency: Buyers may want to get an appraisal on the property they’re interested in before officially transferring ownership. When an appraisal contingency is written into the contract, it allows a buyer to determine the value of a property by means of a home appraisal. In this regard, the home appraisal should find the property worth as much as the official appraisal price – if the appraisal comes in at less than the official appraisal price, the buyer is free to negotiate for a lower selling price.
  • Home inspection contingency: Should an inspection report reveal that certain repairs need to be done on the property, the buyer may either request the seller to complete said repairs (followed by another inspection to confirm that this has been done) or may renegotiate for a lower selling price.
  • Mortgage contingency: The home seller may want to include a contingency regarding the mortgage the buyer gets on the house, requiring the buyer to provide a mortgage pre-approval letter, and to have obtained a home loan for the property within a specific period of time after signing the contract. Should the buyer’s home loan not be approved, the contract will be null and void.
  • Home sale contingency: Buyers usually include this contingency in order to give themselves a chance to back out of the sale in the case of their current property not selling. This contingency usually includes a set amount of time within which the buyer’s home must sell, or else they are allowed to withdraw from the sale.   

Contingency clauses often lead to the sale of a property falling through, which is why it is of great importance to insure that contingencies that protect the buyer and the seller are included when real estate agents draw up the contracts leading up to the transfer of the property.

Warning Signs

Aside from the contingencies included in the pre-sale contract not being met by the buyer, some other warning signs may be signals that a buyer is having second thoughts about acquiring the property.

These may include things like becoming hard to reach and not returning calls or emails, missing appointments about the sale of the property, receiving numerous requests for changes to the contract, not returning documents completed, dated and signed as requested by the seller’s real estate agent, or the failure to pay inspectors or other third parties.

If a seller comes across these warning signs, they should advise their agent to confirm whether the seller is still genuinely interested in the property in order to get the property back on the market without wasting time on someone who isn’t really planning to see the sale through.

The Cost To Sellers 

A buyer that decides to back out of a sale doesn’t lose much, but the cost to sellers in this scenario can be quite high.

It stands to reason that the seller will probably lose money if a sale doesn’t go through. This may be because they will still be required to pay the mortgage on the property they’re selling, and may also have to see to the mortgage of a new property they purchased as soon as the sale of their own property looked like a done deal. Home sellers could also be forced to seek rental accommodation until the sale on a new property goes through, after their current property is eventually sold. The financial loss incurred with an uncompleted sale could be enormous.

Sellers lose a lot of time if a buyer unexpectedly withdraws. They now have to kick-start the selling process all over again, also losing out on the opportunity to sell to the other interested prospective buyers that were looking at the home when it was advertised, but found another house when the property went under contract.

It goes without saying that sellers will not be able to buy a new home until their current home is sold, and a buyer that decides they aren’t interested anymore could delay the timeline they set for moving.

There is precious little for sellers to gain when a property’s sale falls through, and a good real estate agent will try to avoid this course of events as much as they can.

How To Save the Deal

An open channel of communication is the first step towards avoiding a property deal not running its full course. In this instance, make sure that your real estate agent and the buyer’s agent are constantly checking in with one another to make sure everything is on track. Ask your real estate agent to ensure that all communication regarding the sale of your property is undertaken in written form, and that you and the potential buyer both receive copies.

Certain concessions on the sellers behalf may help to convince potential buyers to stay the course, and while the seller may feel averse to costly repairs and renovations requested by the buyer, these hold the potential of costing the seller a lot less than the overall loss of the sale.

Use an Escape Clause

The contingency clauses a seller includes in the contract with the prospective buyer go a long way in preventing the loss of an impending sale. For example, sellers might include a clause that gives them legal standing to sue the buyer for breach of contract, together with stipulations to obtain a percentage of the selling price that was agreed upon. Remember to also include a clause that puts the buyer in default of the contract, should they fail to cancel the sale within an agreed-upon time frame after signing the contract.

Another important factor is the inclusion of an exit clause, which allows the seller to look at offers from other interested buyers, even if the initial prospective buyer included contingencies like the sale of the their own home in the contract. This ensures that the seller is not missing out on opportunities to push a sale through, while waiting for the initial buyer’s contingencies to be met.

Provide Feedback Cards for Instant Feedback 

Getting feedback from prospective buyers directly after they’ve viewed your property during an open house is perhaps the best way to ensure that you and prospective buyers are on the same page.

Ask your real estate agent to print out feedback cards, which prospective buyers can fill out just after a viewing. This provides instant feedback to you and to your real estate agent, allowing you to adjust your marketing approach and prevent a sale from falling through in the first place.

Discuss the questions you’d like to ask on the feedback cards with your real estate agent. Some suggestions include:

  • What do you think of the price of the property? By asking this question, you’ll be able to gauge whether the price you’re asking for is realistic. Of course, prospective buyers will likely always say the price is too high, but if you consistently receive this feedback, together with valid reasons why you’re asking too much, you and your real estate agent may want to consider a price revision, which could, in turn, lead to a quicker sale.
  • How does this property compare to other homes you have recently viewed? Your real estate agent will have thorough knowledge of comparable properties in your city or suburb, and will easily be able to compare the personal views of interested buyers to a professional look at the property market. However, this question provides valuable information about what makes your home stand out from the rest, or where it is lacking and can create a better first impression.
  • What are the worst features of the property? Again, recurring themes here may point to something that could be off-putting to buyers in general, the improvement of which may create more interest in the property.
  • What are the best features of the property? If prospective buyers continuously point to certain features of the home, this may alert the seller and real estate agent to make these things, that are obviously already impressive to buyers, stand out even more.
  • Could you see yourself living here? Ultimately, finding out that prospective buyers can envision themselves living in a home is exactly what real estate agents and sellers want to hear. If the feedback form says the opposite, there is still some work to be done in terms of staging the home more efficiently.
  • What would make you buy this property today? Asking this question opens the door to start negotiating with buyers about a fast sale. If their expectations don’t require action that will take a lot of time, this question could open the door to a sale that goes through much faster than expected.


Having a qualified and experienced real estate agent to help you sell your property is the very best way to make sure all the necessary procedures are followed to ensure a fast sale. Still looking for someone to help you sell? Contact Perfect Agent for a list of recommended agents, tailored to your specific needs.

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