5 Legit Reasons to Back Out of a Home Purchase

In this article, we will take a look at the 5 legit reasons to back out of a home purchase. If you wish to see our detailed analysis, you can go to 14 Legit Reasons to Back Out of a Home Purchase.

5. Agreed Upon Terms for Improvements or Repairs Not Met

This is another repair-related legit reason that convinces buyers to exit the home-buying process. The buyer can choose to back out of a house purchase if the repairs that were included in the purchase agreement have not been done by the seller.

4. Ineligibility for Financing

Ineligibility for financing ranks as one of the 14 legit reasons to back out of a home purchase. In the case of Federal Housing Administration (FHA) loans, the house has to meet certain requirements related to safety, security, and soundness. If the house fails to meet those, the buyer will be unable to obtain a loan which makes him back out of a home purchase.

3. Home Sale Contingency

When a buyer is relying on the sale of an old home to purchase a new one, the inability to sell the current house becomes a reason to back out of a home purchase. The seller can accept other better offers on the market if the buyer fails to sell their existing house within a specified time period.

2. Appraisal Issues

Low appraisals are another reason to back out of a home purchase. This happens when the appraised value is lower than the agreed purchase price. In case the seller doesn’t agree to bring the price down or the buyer doesn’t want to pay more, the lack of mutual agreement can convince the buyer to back out. Therefore, appraisal issues make buyers reconsider the home purchase.

1. Problems with the Home Inspection

The most common reason to back out of a home purchase is related to issues with the inspection of the home. This is when major flaws get revealed during the inspection process and they are costly to repair. An option could be asking the seller to carry out the repairs but in case the seller denies this, the buyer usually opts to back out. Hence, a home inspection that turns out to be worse than anticipated convinces buyers to call off the purchase.

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