Red Flags All Home Sellers Need To Know

Selling a home is a big endeavour that no homeowner takes lightly. But sometimes, finding a buyer can be difficult. If the market is cold, that can make homeowners feel like if they don’t sell to the first person who makes an offer, the home won’t get sold. This is a common but misinformed mindset because not every buyer is a good buyer, and sellers need to be aware of the signs that a buyer may cause trouble and hurt the sale of the home. Here are some telltale warning signs that all sellers need to know when considering offers.

For informational purposes only. Always consult a licensed real estate professional before proceeding with any real estate transaction.

The Buyer Is Only Pre-Qualified For a Loan

When setting out to buy a new home, the first thing agents will advise their clients to do is get pre-approved for a loan, and before a buyer can do that, they need to get pre-qualified. Pre-qualification is one of the most important steps of buying a home. Some buyers don’t realize that being pre-qualified does not mean they’re pre-approved for a loan and think they’re the same thing due to their similar names. When considering offers, always look for proof of pre-approval, a document from the lender stating that the buyer can borrow a certain amount of money. That proof also means that the lender has thoroughly researched the buyer and their finances.

The Buyer Doesn’t Have an Earnest Money Offer

As part of an offer, it’s customary for buyers to make an offer of earnest money to show they’re serious about buying the home. If the homeowner accepts the offer and the buyer pulls out of the deal for a reason not protected by contingencies, the homeowner gets to keep the entire earnest money payment. If a buyer makes an offer with no or even a very small earnest money offer, it can mean that they aren’t very sure if they want the home and want an easy out in case something better comes on the market later.

The Offer Uses Too Many Contingencies

It isn’t strange for an offer to contain multiple contingencies. In fact, buyers are advised to always use three basic contingencies when submitting an offer. They are:

• The appraisal contingency: This ensures the home is worth its selling price.
• The financing or loan contingency: This ensures the buyer has a loan and lets them back out if their approval is revoked.
• The home inspection contingency: This ensures the buyer can get the home professionally inspected and issue a Request for Repair if anything turns up.

The trouble with contingencies is when a buyer seems to include every single one they can think of. If this seems to be the case, it can mean the buyer is trying to give themselves space to back out of the deal freely at any inconvenience as long as it aligns with a contingency.

The Buyer Tries To Change the Timeline

After an offer has been accepted, the buyer and seller will also agree to the timeline they will both work on. This is important for both parties to keep to because the seller may need time to buy a new home, or the buyer may have a set date they need to move If a buyer is trying to accelerate or decelerate the already-agreed-upon timeline, that can be a red flag because it may mean something is wrong on their end, such as something their mortgage lender withdrawing approval, forcing the buyer to find a replacement.

Selling a home is already a stressful and arduous process, and dealing with a bad buyer can make it even more so. Keeping an eye out for these red flags can help sellers identify and avoid a bad deal.

For informational purposes only. Always consult a licensed real estate professional before proceeding with any real estate transaction.