Pending home sales are a term that gets thrown around, but do you know what it means?
As a lender in Washington DC, we obviously see pending sales often. Here are some things to note about these types of homes:
What is the Meaning of a Pending Home Sale?
Pending home sales are when the sale of a house has been agreed to all parties involved, but the contract has yet to be finalized. This can happen for many reasons including an appraisal coming in lower than expected or due diligence turning up issues with the property.
Pending sales can take anywhere from weeks to months before they close on average depending on how quickly things get resolved!
Can a Pending Home Sale Fall Through?
Pending home sales can fall through, and this is why it’s so important to always get a home inspection before making an offer on a house. If there are issues with the property that cannot be resolved or repaired within your budget you don’t want to end up in buyer’s remorse!
If something does come up during the due diligence process, you have a couple of options. You can either work it out with the seller or walk away from the deal altogether! This may be frustrating but always remember that there are plenty more homes on the market and finding your dream home is worth waiting for.
Can a Seller Back Out of a Pending Home Sale?
Technically, a seller may withdraw at any moment if the conditions of a house purchase contract are not satisfied. These contracts are enforceable legal agreements, which is why withdrawing from them might be tough, and why most people want to avoid it.
They might decide they don’t want to sell for the following reasons:
- The seller’s housing market strategy might be a little bit too aggressive, causing potential purchasers to get cold feet and decide to put the house on the market.
- They can’t find another place to live. When their purchase of a new home falls through, this is quite typical. Without any place to go, the lack of replacement housing might indicate that the seller is no longer able to sell his or her current property.
- The pregnancy of a loved one or death in the family might prevent them from closing the deal.
- A low appraisal might be harmful to a sale on the seller’s side, and if they won’t reduce the sale price to match the appraisal value, the deal will be canceled.
Why Do Houses Go From Pending to Back on the Market?
There are a few reasons why houses go from pending to back on the market.
The first reason is that the contract falls through. This could be because of something that was found in due diligence, or maybe one party couldn’t meet the terms of the contract.
Another reason for this happening is when the seller changes their mind after the offer is accepted. They may have found another house they like better or decided that the sale price was too low to make sense for them.
The third reason a home goes back on the market after being pending is because of appraisal issues. If an appraiser comes in with a value lower than expected, then it can create problems during the closing process and the sale might fall through.
There could also be major issues that were found during an inspection. If there is a large amount of damage to the house, and it can’t be fixed within your budget then it’s best to simply walk away.