Closing a real estate transaction is not an easy task. It is difficult to manage because you must deal with many moving components. It is no wonder we have real estate agents who specialize in this matter, and we pay them well for this challenging job. 

In a real estate transaction, a buyer may withdraw from the deal at any given time for whatever reasons. Real estate agents should be ready in case they encounter such instances. Therefore, take note of these common reasons buyers walk away from real estate deals. 

Pressure to Make Long-Term Financial Commitment

Losing confidence or putting too much pressure on making a long-term financial commitment is a common reason a buyer backs out of buying a house or any real estate transaction. This is because the process of buying a house can be overwhelming, especially for first-time homebuyers. 

Coupled with the overwhelming emotions while going through the process of picking a home is the significant amount of time associated with it. It is not a walk in the park since you will visit several open houses and complete numerous paperwork. 

Moreover, a home purchase is a significant investment. Probably, it is the largest investment they will ever make in their entire lifetime. It is understandable that they will be nervous and lose confidence along the way. When the pressure is too heavy to carry, some buyers are backing out of buying a house.

The Buyer Simply Changes His Mind

A change of mind is not uncommon with homebuyers. For instance, the buyer may fall in love with the property on his first visit. But, later, the buyer will see the house differently and decide he will no longer purchase the property. As a seller, do not be surprised when this happens. 

It is only unfortunate when the buyer walks away in the middle of the deal. Be sure to ask the buyer what he does not like or any issue about the property that might make him withdraw from the transaction. Always broach this question to the buyer throughout the deal. In this way, you can give the buyer better options later. 

The Property is in Need of Repairs

If the home is in need of repairs, that would be an additional expense to the buyer. After a home inspection, an interested buyer may back out from the transaction if the inspection shows that the property requires several repairs. Unexpected expenses due to property issues that need to be fixed typically scare away interested buyers. 

As a real estate agent, you can suggest to the seller to conduct a home inspection before listing the property. You can review the results of the inspection with the seller and talk about possible options. The seller may decide to conduct either minor or major repairs. He may agree to both or none at all. 

If there is a home inspection and you fix some of the issues before listing the home, you can place a reasonable price on the property. It can also reduce the chances of the interested buyer backing out of home purchase.

The Buyer Finds a Better Option

Buyers will often have multiple options when looking for a home. While they may sound enthusiastic about your home, it does not mean they are not looking at other properties. Of course, homebuyers want to find the best deal, so they expand their options. 

If you are the seller, it will be unfortunate to engage with such buyers. As a solution, you can set a higher earnest money deposit. The buyer will be committed to you once he deposits high earnest money. This also shows a high level of sincerity that the buyer will purchase your property. 

However, putting an earnest money deposit does not guarantee that the buyer will never withdraw from the deal. 

Concurrent Closing Fails

Concurrent closing is when a buyer is trying to purchase and sell a house at the same time. The buyer will sell his first property to finance the home purchase. If he fails to sell his first home, he can walk away from buying your property. 

If you are the seller in this situation, you should communicate and ask the buyer concerning the progress of the sale of his first house. Moreover, you should understand the circumstances of your buyer. If he backs out of the transaction, it is more likely that the sale of his first property failed. 

Takeaway

There are various reasons a buyer will withdraw from a real estate transaction. In such a case, you should determine the situation of the buyer and understand it. You can also set some strategies to anticipate whether the buyer will walk away from the deal or not. Proper and consistent communication with the prospective buyer is crucial.