The process of buying or selling a home is often an emotional roller coaster! It’s no surprise given how many steps are involved and the number of people who play a role in the transaction. For both buyers and sellers, the experience is full of various emotions and plenty of ups and downs.
And, while most Realtors typically bring you to a successful closing, there are times when a home might fall out of escrow.
In my experience, the most common reason a home might fall out of escrow is: Buyers’ Remorse
Quite simply in our competitive Los Angeles real estate environment, buyers sometimes get caught up in the excitement. In these instances, the buyer often changes their mind within the first couple of days from their offers’ acceptance. Usually before their earnest money deposit makes it to escrow.
Sometimes homes fall out of escrow for other reasons. But a savvy real estate agent is typically able to successfully negotiate these scenarios.
Home Inspection Issues: A professional home inspection is nearly always part of the process. This contingency allows the buyer the opportunity to cancel escrow and have their earnest money refunded. Home inspections can sometimes reveal major issues such as mold, foundation defects, cracked chimneys and a variety of other items which are expensive to repair.
Low Appraisals: Several years ago, I would have told you that more often than not, a skilled Realtor could get the appraiser to reconsider. But rarely are they doing so now even when their appraisal if full of misinformation. Typically, the buyer and seller agree to some give and take. Often the buyer’s down payment is such that a low appraisal won’t impact their loan.
Before your real estate agent recommends you accept an offer, the buyer should already have been prequalified. Their qualification should be further vetted by your agent. Rarely should an escrow fall apart due to financing.
Remember, there are a lot of moving components to an escrow. In order to have the best experience ensure you have an experienced real estate team working diligently on your behalf. If you have any real estate related questions, feel free to reach out. We look forward to hearing from you.