When your home goes under contract, it can feel like the hard part is over. But “pending” doesn’t mean guaranteed. Nationally, 6% of deals unravel before closing day. Sellers looking to avoid potential pitfalls often ask, “Why do pending home sales fall through?”
We spoke with Jamie McMartin, a top-rated HomeLight Elite real estate agent in Texas with more than 18 years of experience. She shares the top reasons a home sale may come to a halt, and how you can take proactive steps to cross the closing-day finish line.
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1. Financing falls through
Even if a buyer is pre-approved, their loan can still be denied before closing. Lenders often re-check employment, income, and credit right up to the end. A job change, new debt, or unexpected financial setback can derail approval.
“In the Houston area, about 15% of pending home sales have fallen through in the last month, which is a record since 2017,” McMartin says. “One reason we’re seeing is finance — buyers can lose their approval after the fact.”
Sellers should look for buyers with strong pre-approval letters from reputable lenders — not just pre-qualification. Asking your agent to vet the buyer’s financing early can save you stress later.
2. Home inspection reveals major issues
Once the inspection report comes in, buyers may request repairs, a price reduction, or credits — or they might walk away entirely if the problems are significant.
“With the high inventory that we’re seeing, buyers are very easily turned away when they see things like foundation issues, mold, roof damage, or other expensive repairs pop up,” McMartin says. “They don’t want to be in a money pit. So with all the inventory on the market right now, we’re seeing buyers be less tolerant of those kinds of issues with the property.”
Top agents like McMartin recommend considering a pre-listing inspection to uncover big-ticket issues in advance. This approach can prevent tense negotiations mid-transaction.
3. Appraisal comes in low
If the appraisal is lower than the agreed-upon price, the buyer’s lender will typically only approve a loan based on that lower value. Unless the buyer can make up the difference in cash or you’re willing to reduce the price, the deal may collapse.
McMartin, who works with 82% more single-family homes than the average Houston agent, says sellers who insist on pricing high in the current market will see their home sit unsold, or face delays or a canceled deal after a low appraisal. “Sellers need to be realistic and listen to their agents, whether it be on pricing or what to repair.”
According to data from the National Association of Realtors (NAR), it’s estimated that 6% of contracts are delayed due to appraisal issues.
4. Buyer’s home sale falls through
When a buyer’s offer is contingent on selling their own home, your deal can be at the mercy of another transaction. If their home sale collapses, they may no longer have the funds or lender approval to buy yours.
To avoid this potential pitfall, sellers should work closely with their agent to vet each offer and weigh the pros and cons. In some cases, sellers might prefer offers without home sale contingencies — even if they’re slightly lower — to reduce risk.
5. Problems caused by an inexperienced agent
An agent’s role is to manage deadlines, documents, and communication between all parties. If the buyer’s or seller’s agent is inexperienced or disorganized, critical steps can be missed, like scheduling inspections, sending disclosures, or meeting contract timelines, which can put the deal at risk.
“An experienced agent who is savvy and knows how to operate their business like a business can definitely have an influence in keeping deals together,” McMartin says. “But if you have an inexperienced agent or somebody who is part-time — not in it for the long haul — they won’t know how to operate in a market like this. That’s when things can fall through.”
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6. Title issues or liens
A title search can uncover ownership disputes, unpaid property taxes, contractor liens, or easements that weren’t previously disclosed. These problems can stall or kill a deal if they can’t be resolved before closing.
Your best defense against this dealbreaker is to address potential title concerns early. If you think there may be an issue, order a preliminary title report before you list. If there’s a lien or error in the records, you can work on clearing it before you even accept an offer.
7. Home is uninsurable or faces insurance challenges
In some areas, finding affordable — or any — homeowners insurance is becoming harder. Homes in flood zones, wildfire-prone regions, or with prior claims can be considered too high-risk by insurers. Without coverage, most lenders won’t approve the mortgage, and the buyer may walk away.
“Some sellers ignore repairs, pricing reality, or rising insurance costs,” McMartin says. “Sellers need to be aware of what’s going on in the market. These risks have led to sales canceling really fast, and with this market shift that we’ve seen, they definitely have to make sure their heads are not in the sand.”
To get ahead of this issue, check insurance availability before listing. If you know your home’s insurability status, you can provide buyers with accurate information and even connect them with local agents who can help.
8. Buyer gets cold feet
Sometimes, buyers change their minds for reasons unrelated to the home itself — perhaps they get nervous about the financial commitment, have a life change, or simply feel the property isn’t the right fit after all. While frustrating, these situations do happen, especially in slower markets where buyers feel less pressure.
“High mortgage rates mean more buyers get sticker shock, and they walk away or lose their loan approval,” McMartin explains. “A buyer may be pre-approved, but when it’s time to get the contract and they start working through all the financial details, they’re not liking what they’re seeing, and a lot of it’s due to the mortgage rates.”
Keeping buyers engaged and informed throughout the process can help. Regular updates, quick answers to questions, and a smooth transaction experience can keep buyer confidence high. Still, sellers should be prepared for the possibility that emotions can influence decisions.
Warning signs of buyer cold feet: “For most agents, when you’ve got a deal coming together and you’re under contract and everything’s running smoothly, there’s a lot of rapport that goes on back and forth, and it’s very timely,” McMartin says. “But when you start seeing a lack of response, that’s when your red flag should go up and say ‘Something must be going on’ — the buyer may be getting cold feet.”
9. Problems with closing documents or deadlines
Real estate transactions have many moving parts — loan approvals, escrow requirements, title documents, and more. If a party misses a deadline or paperwork is incomplete, the contract can expire. There is a higher risk of issues when the agreements have special clauses or conditions.
“Our contracts in Houston are TREC (Texas Real Estate Commission) contracts that highly favor buyers,” McMartin explains. “They do protect the sellers, but they highly favor the buyers, and we are in a buyer’s market, at least in most areas. So, I would advise against any special clauses at this point and just go with what the contract states.”
Delays with lenders, appraisers, or even moving logistics can also push closing past the agreed date, leading to cancellations.
How sellers can reduce the risk of a deal falling through
While no seller can eliminate all risks, preparation and strong professional support can go a long way. McMartin’s advice: build buyer trust from the start.
“If there are any major things that have happened to the property, like a flood, foundation issues, mold, and everything was rectified, provide all that information upfront so the buyer’s agent doesn’t have to claw for it — that is ideal,” she advises. “That builds trust with the agent and the buyer that everything’s on the up and up.”
Other actions you can take to reduce the risk of a deal falling through include:
- Vet buyers carefully: Look for solid pre-approvals from reputable lenders.
- Address issues early: Order a preliminary title search and consider a pre-listing inspection.
- Maintain communication: Regularly communicate with your agent and potential buyers to promptly address any questions or concerns.
- Stay on top of deadlines: Keep a calendar of all deadlines related to the sale and ensure you meet each one to maintain momentum.
- Work with an experienced agent: Choose a top agent who can spot red flags and keep the deal on track.
- Stay flexible: Be open to reasonable repairs or concessions if it means keeping a qualified buyer.
“Sellers need to listen to their agents because taking a hard stance of ‘I am not doing this’ or ‘I’m not fixing that’ just isn’t working in this market,” McMartin warns. “It’s very important they listen to their agents during this time.”
She also warns against the games that some sellers play. “Playing games during this time period is not good. For example, when a seller withholds responding for a couple of days because they’re emotional, don’t agree, or are just trying to play the negotiation game, I think that’s a huge mistake in this market.”
McMartin adds, “Responding quickly, without emotion, and being open-minded to the situation is what’s going to prevent the sale from falling through.”
Try our Homebuyer Fear Finder tool
If you want to review the top home issues that frighten buyers the most, check out our Buyer Fear Finder below:
Conclusion: Stack the deck in your favor
One of the best ways to boost the odds that your home sale makes it to closing is to partner with a top real estate agent. HomeLight can connect you with a top-performing agent like Jamie McMartin, who will bring a wealth of knowledge to your side of the negotiating table.
If your deal ends up falling through, McMartin offers this closing advice:
“Get your home right back on the market and address any of the issues that caused it to fall through, whether it be pricing, repairs, or something like not responding in a timely fashion. Talk to your agent, and correct whatever it was that caused the deal to fall through.”
By anticipating potential problems — and working with an experienced, proactive agent — you can give your sale the best chance of a smooth finish.
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