What Should Sellers Do If A Buyer Backs Out Of The Deal?
It is not before a lot of hard work is put in that a property seller is finally able to get an offer he would not want to decline. At that juncture, an agreement to sell is signed between the two parties, setting the terms and conditions based on which the future tarnation will take place. One key clause in these documents is about the time frame within which the transaction must be completed, failing which the deal is off. The party responsible for this falling through of the deal has to take monetary losses – the buyer will lose the earnest deposit; the sellers will have to pay an amount equal to the earnest money or more if the deal is off because of him.
Such a situation would be unpleasant for both the parties. However, such a situation might arise for a number of reasons. Even if a seller does all in his capacity to see the deal through, a buyer would typically back out of a deal for any of the reasons mentioned below:
*The bank refuses to grant him the loan amount he has applied for.
*He is able to strike a better deal elsewhere and is not really disappointed about losing the earnest deposit.
*His efforts to arrange the down-payment fall flat.
*His personal situation changes in the meantime. This may be on account of job loss, accidents, etc.
In such a situation, what are your options as a seller?
Call a spade a spade: When your property is back in the market, buyers will most likely look at it with a suspicious mind. Without even getting into what might have gone wrong, they would judge the property of being in some sort of trouble and stay off. While relisting your property, specifically mention the reason owing to which the previous deal did not materialise. You would be happy to see the response clarity would afford you in the property market.
Second in line: While selecting properties, buyers do have back-up plans. If they are not able to buy the property they love the most for any reason, they would go for the second-best option. Sellers must apply a similar strategy. In you are in an immediate need of money, you might consider selling the property to a buyer whose quoting price was not impressive, but, it was not bad either. Like in all spheres of live, be ready with a back-up plan to lessen the blow of any mishaps.
Quick change: Apart from clearly stating the reason because of which you were not able to sell your property to the earlier buyer, you may also have to do some tinkering in your offer to make it ‘irresistible’. One way to do that is to lower the rate a little. You will be widening the buyer base by doing that. In case this is an area where you are not willing to make compromises, spread the news among your family and friends. They will be able to get you a buyer willing to pay the price you are asking for. You could also let the property hibernate a little before you are back in the market, with a better selling strategy. In the market is weak, for instance, it would only be the best to wait and watch till things look up.
Once bitten twice shy: Your efforts would yield results and you would soon be able to find another buyer. We hope you would do a better research about the buyer this time. Do not leave any scope for a situation to arise where the deal goes cold. Take a call only after judging the financial position of the buyer. Also, try to close the deal as soon as possible. This would limit the scope of any unwarranted occurrences to take place.