You accepted an offer, started packing, maybe even made plans for the money. Then the call comes: the buyer is backing out. It’s one of the most frustrating things that can happen when you’re selling a house, and it can leave you in a tough spot, especially if you’ve already committed to your next home.
Here’s why sales fall through in Spokane, Coeur d’Alene and the Tri-Cities, what you can do about it, and how to keep it from happening again.
Why home sales fall through
Financing problems
This is one of the most common reasons. A buyer’s loan can fall apart because of a job change, new debt, a credit issue or a rate change that pushes the payment out of reach. First-time buyers stretching to qualify are especially vulnerable when rates move.
Low appraisal
If the house appraises for less than the contract price, the lender won’t lend the full amount. The buyer may not have the cash to cover the gap. Appraisal gaps happen more often when prices are flat or falling, or when a house is unusual and there aren’t many good comps.
Inspection problems
An inspection can turn up a roof near the end of its life, an old electrical panel, plumbing leaks, foundation cracks or a failing furnace. Buyers may ask for repairs or credits, and if you can’t agree, they can walk away. Our post on houses that might not pass inspection covers what usually comes up.
The buyer’s own house didn’t sell
If the offer depended on the buyer selling their current home, a delay on their end becomes your problem.
Title issues
Old liens, judgments, boundary issues or problems with past transfers can surface in the title report and delay or stop a sale.
Cold feet
Sometimes buyers simply change their minds, find another house or get spooked by news about the market.
What to do right away
1. Read the contract
Your purchase agreement spells out what the buyer can and can’t do. Look at the contingencies for financing, appraisal, inspection and the sale of the buyer’s home, along with their deadlines. If the buyer canceled properly under a contingency, they’re generally within their rights. If they backed out for a reason the contract doesn’t allow, or after a deadline passed, you may have options.
2. Ask about the earnest money
Buyers usually put down earnest money when the contract is signed, held by the title or escrow company or a brokerage. Whether you can keep it depends on why and when the buyer canceled and what the contract says. Talk with your agent, and if there’s a dispute, a real estate attorney.
3. Try to negotiate
If the problem is a low appraisal or an inspection item, a compromise may save the deal: a price adjustment, a repair credit, splitting the appraisal gap or a later closing date.
4. Get legal advice if needed
If the buyer breached the contract and real money is at stake, a real estate attorney can explain your options. Legal action is usually a last resort, because it takes time and money.
Getting back on the market
If the deal is over, you’ll likely relist. A few things help:
- Find out exactly why it fell apart. If it was inspection or appraisal, the next buyer may run into the same issue.
- Fix or disclose what came up. If an inspection found problems, you may need to address or disclose them now that you know about them. Washington and Idaho both use seller disclosure forms, so ask your agent or attorney how to handle it.
- Check your price against recent sales, especially after a low appraisal.
- Screen offers more carefully. Look at the buyer’s pre-approval, down payment and contingencies, not just the price.
Keep in mind a listing that returns to market can look like “something must be wrong” to buyers. Your agent should be ready to explain what happened.
When you’d rather not start over
If you’ve already lined up your next home, a job or a move, starting the whole process again may not be an option. A cash sale can take the uncertainty out of it. With Backyard Home Buyers:
- You’ll usually have a fair cash offer within 24 hours.
- We pay cash, so there’s no loan or appraisal to fall through.
- We buy as-is, so inspection findings don’t derail the deal.
- No fees or commissions, and we pay the closing costs.
- Close in as little as 7 days, or on the date you need.
- Rent-backs are available if you need a little time after closing.
If you’re still under contract with the original buyer, sort out that contract first. We’re happy to give you a number in the meantime so you know your fallback.
We’re a local, family-owned company. Both owners were born and raised in the Inland Northwest, and we’ve done over 500 deals since 2019 in Spokane, Coeur d’Alene and the Tri-Cities. See how it works, or call (509) 461-9079.