It happens to the best of us. Sometimes, real estate deals fall apart. In fact, the National Association of Realtors notes that at least 5% of real estate deals terminate before closing.

Usually, when your home purchase falls through the problem lies with the financing. Sometimes, you can fix the problem, and sometimes, you can’t. 

Analyze Why The Deal Fell Apart

Getting pre-approved for a mortgage is usually a great defense against home purchase problems. Nevertheless, even pre-approvals can fall through under certain conditions.

Here are some common reasons why home purchase deals fall apart.

1. Your credit profile has changed. Once you’re pre-approved for a loan, you should avoid major purchases and apply for more credit until after you’ve closed on your house. 
2. You’ve changed your job or lost your job. You might not be able to help this one, but changing or losing a job changes the nature of the risk you represent. 
3. The home appraisal is too low. The house must be of sufficient value for the mortgage to make good financial sense. While we always hope that the appraisal will be close to the list price, there are often vast differences between the two.
4. The home inspection reveals the home isn’t eligible for financing. For example, both FHA loans and USDA loans require the homes to be in good condition. If the home has wood rot or general safety issues, then the lender will refuse to issue a mortgage for that home. 
5. There are title issues.

Always protect yourself with contingency clauses that allow you to back out of the deal legally if the appraisal, financing, or home inspection come back with problems. Sometimes, a dropped deal is a good thing, especially if it prevents you from purchasing a home that will ultimately be a bad deal for you. 

See also: What to Expect During the Home Inspection

Evaluate Your Options

If your credit profile has changed, you’ll probably need to restore your credit score before you can search for another house. Some lenders are more flexible and may be able to close a loan where other lenders failed.

If you’ve gotten a new job, talking to your lender might help, particularly if the new job represents a step up with more money. 

Home appraisal, inspection, and title issues might require you to go find another house, but you’ll still be in the game. 

Ensure Your Best Chance

Nobody wants to watch a deal fall through. Ensure you get your best chance at a solid deal by seeking mortgage pre-approval from Alex Doce. 

Alex will also provide you with all the information you need to avoid sudden issues with your approval, and will help navigate and steer you around other pitfalls as well. 

Schedule a one-on-one consultation with Alex Doce today, or call (800) 355-ALEX.