Sometimes real estate transactions fall apart. One of the more frustrating scenarios is when a buyer gets cold feet. Now your home’s status must change from “pending” back to “for sale,” and there’s a chance the house will appear tainted in some way to other buyers. People often assume something was wrong with the home if a sale went bad. As a seller, there are certain warning signals you can see from the start to avoid buyers who’ll get cold feet. Here are some of those signs.
1. Only one spouse has seen the home. Especially in a market with low inventory and fast sales, it’s not uncommon for one spouse to view a home before the other can join. If the couple puts in an offer before the other spouse has seen it, there’s a risk he or she will not be as excited as their partner and will look for ways to back out of the offer.
2. The buyers view the home three or more times before making an offer. These buyers are either very indecisive or they’re trying to talk themselves into choosing the home. Either way, it could be a sign that they’re not committed to the house or to closing the deal.
3. The offer contains many contingencies. Typical contingencies that come with a buyer’s offer often include inspections, title review, buyer financing, and a review of the HOA documentation, when applicable. If a buyer includes many more contingencies on top of that, you may be dealing with someone very picky. Of course, a seller needs to be reasonable as well—sometimes contingencies are warranted when the home is not in great condition. But if the contingencies seem over-the-top, proceed with caution.
4. The buyers see the home at an open house but never view it with their agent. It’s better practice for buyers to make use of their agent’s expertise to point out potential issues with the house. Buyers who view on their own run the risk of discovering facts (after acceptance) that an agent would have noted.
5. Buyers don’t have an agent but make an offer. Buying a home is a serious purchase. Buyers without an agent could be ones who haven’t yet educated themselves on the entire buying process. Or perhaps they were planning to get one but found your house first. What if they represent themselves or ask your agent to be a dual agent (one that represents both the seller and the buyer)? Both of these scenarios come with reservations.
6. They just started looking today. If a buyer puts an offer on your home the first day they started their search, they’ve probably not put in the time to figure out what kind of home works best for them. Such a buyer often second-guesses their decision and gets cold feet.
Each situation deserves its own consideration. You and your listing agent should follow the strategy that protects your best interest before signing any purchase contract. An expert listing agent will often see red flags in buyers who present a “cold-feet” risk. No buyer comes with a guarantee to close, but you might save yourself time and headache by paying attention to the warning signs before agreeing to a contract.
Real Estate Term of the Week
Pending: A home’s status is changed to “Pending” in MLS (Multiple Listing Service) once the seller has accepted an offer but the deal hasn’t closed yet. During this period, the lender and escrow agent or attorney process the loan and title documents to make sure the deal closes on time. Pending does not mean sold because there are any number of things that could prevent the house from closing—buyer financing falls through, a buyer backs out after inspection findings, or other reasons.