Buying a House 7 Reasons Why Real Estate Deals Fall Apart When Buying a House

Real estate agent and Realtor Matt Leighton talks about the seven main reasons that real estate deals fall apart.

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Buying a House for the First Time 7 Reasons Why Real Estate Deals Fall Through

0:40 1. Home inspection issues. The buyer could ask for an unreasonable amount of items or the seller could refuse to fix or provide a credit for home inspection items.

2:26 2. The buyer's financing gets rejected. If the buyer adds a lot of new debt or loses their job or their DTI (debttoincome ratio) increases above a certain level, the buyer may get rejected for the loan.

3:17 3. Low appraisal. The bank will send out an appraiser to confirm the property's value. If the appraiser tells the bank the property is actually worth less than the contract price, the buyer and seller have to renegotiate. If the buyer and seller do not come to an agreement, the buyer could back out of the contract.

5:10 4. The buyer gets cold feet. The buyer changes their mind and backs out of the deal.

6:21 5. Title issues. It is the seller's responsibility to transfer a good an marketable title. If there are liens or judgements against the seller, it is possible that the seller is not able to transfer the property until those judgements or liens are paid off. And if the amount owed is higher than what the seller would receive when selling the property, the seller might not be able to sell unless they "bring money to the table" to satisfy any outstanding judgements or debts owed.

7:51 6. The buyer doesn't have enough money for closing costs. This happens when the buyer is tight on finances or an unexpected cost like a hospital bill came up right before closing. If you don't have money for closing costs, you could ask relatives for gift funds (where they give you money for settlement), you could negotiate in buyer closing costs paid for by the seller, or maybe you should wait until you have money to pay for closing costs before purchasing a home. Especially if you're a first time home buyer, it's wise to save for unexpected costs and expenses.

9:25 7. Buyer's house does not sell. If the buyer needs the funds from their house to purchase their next property and their current house is not selling, then the deal could fall apart. We're not really seeing Home of Sale Contingencies as much these days since the market is so competitive. But if a buyer's house isn't selling, it may cause their purchase deal to fall apart.

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Matt Leighton Arlington VA Real Estate Agent
Matt [at] Orange Line Condo dot com
Century 21 Redwood Realty
1934 Wilson Blvd
Arlington, VA 22201
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