Common Culprits: Why home sales fall through and how to avoid them
Just when you think everything's sailing smoothly with a signed Offer to Purchase (OTP) in your hand, the unpredictable seas of home selling can throw you off course. Brace yourself, it's not always a joyride. There are a few twists and turns you need to be ready for.
Let's shine a light on some of the most typical culprits that can leave a home sale stranded just shy of the finish line:
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Buyer's Bond Application Rejection: In today's high-interest rate environment, buyers may find it challenging to secure the full bond amount they initially anticipated. If a buyer's bond application gets rejected, and they can't secure alternative funding, the sale could collapse. Many sellers prefer cash offers or those from buyers with pre-approved home loans from their bank or a bond originator. Get yourself prequalified here
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Unmet Suspensive Conditions: Suspensive conditions are prerequisites that must be satisfied before the transaction can proceed. While bond approval is the most common, other conditions may be included in the OTP. These conditions are usually listed as follows: "[...] is subject to and conditional upon the fulfillment of the following suspensive conditions:". Buyers then list specific conditions, such as requiring the seller to address unapproved structures or demanding an additional home inspection. Both parties must agree to fulfill these conditions before the sale can proceed.
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Issues Discovered During Required Inspections: Before closing a sale, sellers must obtain certificates of compliance (CoCs) to confirm that the property meets safety standards. This includes electrical, plumbing, gas, and beetle compliance certificates. If issues are uncovered, the seller is responsible for rectifying them at their expense. If there are delays in addressing these issues, the offer may expire. Depending on the OTP terms, the buyer can choose to extend the offer or cancel it.
Let's get real about this. If you want to dodge that gut-wrenching experience of a home sale crumbling at the eleventh hour, it's all about being transparent with your real estate pro. We're talking full disclosure here, folks. Don't hold back - spill the beans to your agent about every nook and cranny of your situation. Why? Because these industry wizards have a knack for conjuring solutions out of thin air, squashing any potential snags before they grow into deal-slaying monsters.
And remember, if something's gnawing at your peace of mind, don't just stew in your worries. Reach out to your agent. Ask questions. Seek clarity. It's their job to guide you through this maze, and trust me, they've seen it all before. So keep those lines of communication wide open, and let them pave the way to a successful closing.
