When it comes to home buying, being overprepared is a good thing, especially in beautiful locations like Topsail Island. There are a lot of small details that go into the process of a home sale. Sometimes these small details can mean big problems, so it’s important to understand and know the process as much as possible.
Closing a deal on a home can take weeks of time. During this timeframe, there are a lot of things that could go wrong. From issues with the buyer’s finances to problems with the title of the seller’s property, having in-depth knowledge of these common problems can help protect you from experiencing them. We’ll go over some of the most common issues you might encounter during the pending sale of a home. Additionally, we’ll explain what measures you can take to ensure that any home sales on Topsail Island go smoothly.
What Is a Pending Home Sale?
A pending sale is also referred to as “under contract.” This term refers to the time period after a seller has accepted an offer until the sale is finalized. During this time, there may be contingencies that arise, which may impact the sale of the home. In these cases, the sale may fall through.
When a sale of a home falls through, this means that the seller has to repeat the whole process with another potential buyer. Having to go through another contract with a different buyer is a hassle and not something that sellers want to go through. In order to avoid this headache, it’s important to think ahead of all the possible issues that could arise during the pending sale.
What Can Go Wrong During a Pending Home Sale?
There are a few issues that commonly occur during the pending home sale process. By understanding and anticipating these possible issues that prevent the sale from being finalized, you can prepare for most contingencies for selling real estate on Topsail Island.
The Buyer’s Financing Falls Through
One of the most frequent reasons that home sales aren’t completed is because the buyer is rejected for financing. Since most homebuyers use some sort of financing to purchase a home, most potential buyers will submit a pre-approval or pre-qualified letter. With a pre-qualification letter, the bank will estimate a number for a loan that they believe the buyers are able to afford. With a pre-approval letter, the bank takes a closer look at the buyer’s credit and buying capabilities and approves a particular loan amount based on that information.
However, neither one of these options is a sure thing. The bank could still not approve the mortgage when it comes time to finalize the deal. The reason for this change may have to do with the buyer’s financial status. If the buyer goes through sudden job loss or acquires more debt than originally submitted to the bank, then the loan might not be approved. In this case, if the buyer includes a financing contingency in the contract, they may be able to walk away without paying any penalty fines.
Problems With the Home Inspection
Another common issue that arises during the pending sale period is a failed home inspection. Most buyers will hire a home inspector to take a look at the property to ensure that it’s in top condition. If there are serious and costly repairs necessary, then the buyer may be able to back out of the sale or start negotiations on price.
If you are aware that your home needs serious repairs, like a new roof or eliminating mold that is present in the home, then you should consider making those repairs before the sale. It might also be a good idea to hire your own inspector so that you won’t be caught off guard by any issues. Waterfront homes often deal with water and weather damage, so it’s important, if you’re selling Topsail Island real estate, that you look out for any issues related to that.
The House’s Appraisal Is Lower Than the Sale Price
Lenders will generally send out an appraiser to inspect the property to ensure that its value is congruent with the sale price. If the sale price and the appraiser’s opinion of the property value don’t match, the lender may not approve the mortgage. In a hot seller’s market, properties are limited and, therefore, can fetch a higher price than it may actually be worth. So when a bidding war happens, and the final price is much higher than the home’s value, the bank could decline the loan or request that the buyer pay more cash upfront.
There Are Existing Issues Concerning the Title or Property Liens
In order to sell a property, there must not be any issues with the title or property liens. The lending bank will hire a company to look into title issues to ensure that the sale can go through. Some possible issues include property taxes and contract work that hasn’t been fully paid or other people on the deed who haven’t signed off on the sale. If a buyer doesn’t want to wait for however long it takes to clear up these kinds of issues, the sale won’t happen.
How Can You Protect Yourself From These Common Issues?
With so many potential problems that can happen during the pending sale of your Topsail Island real estate, it’s important to prepare yourself to avoid these issues. There are a few things that you can do to prevent a situation where the sale falls through. It’s a smart idea to stay ahead of these issues and remain proactive before they become a problem.
One of the easiest ways to avoid any issues is to be selective about which offer you choose. A high offer doesn’t necessarily mean that it’s the best option. If you want to prevent a buyer from backing out of a sale due to financing issues, you should require a pre-approval letter, plus proof of funds for the down payment.
Another option to avoid any problems down the road is to hire an inspector before you try to sell your property. With this strategy, you’ll be prepared for any damage or repairs that will come up later. You may want to take care of these issues or state them outright to any potential buyers to avoid any issues later in the process.
Generally, most Topsail Island real estate finds buyers fairly easily, thanks to its tranquil and idyllic island location. But completing home sales on Topsail Island can have its challenges. However, being prepared for any possible contingencies is the best strategy to sell your home quickly and easily. Working with a trusted real estate company that has extensive ties to the community is the most foolproof way to ensure that the selling of your property goes smoothly. Our team is experienced and ready to take on new clients on Topsail Island, so get in contact with us today if you would like to learn more about how we can help you sell your home.