It is not often in life that we go through an experience and do not experience some form of a setback. It is how we react to these set backs that help make us better (or worse) people. Whether you are the buyer or the seller of a home, there are potential set backs you may not have even thought about that are not done routinely. In this article we will outline some of these potential issues, and why it causes a set back.
- The appraisal is too low.
An appraisal is done by the lender to make sure that the home is being bought at a price of what the home is actually worth. Many times if there is a “bidding war” between buyers, the price the home is ultimately purchased at is relatively higher than what the appraisal says that the home is worth. In this case, you have a couple of options.
The first is that you will need to pay cash for the difference of the accepted offer minus the appraisal. The next choice is to get another appraisal done to see if there is a difference between them. The last would be that the seller needs to adjust their asking price for the home.
An appraisal is ultimately done to protect the lender. In the case of a foreclosure, this will allow them to get the money back that they lended for the original purchase of the home.
2. There are issues during the home inspection.
If you are the buyer, this is a hold up that should generally make you happy. If there is something big enough to come up during the inspection, it is important that the buyer takes care of it on their dollar as opposed to you not knowing of it till you move in. While there are some instances where the seller and buyer may make an agreement about the issue(s) (ie: lowering cost of the sale), it may be in your interest to have the seller take care of this issue before you move in (this could become more of a headache than you bargained for).
3. Someone backs out
Often times in a contract to purchase or sell the home, there is a way for one party to back out without penalty. This would be described as the party getting cold feet. While ultimately there may be something you could do to reverse this, most times it is an aspect that you cannot help from happening. While the buyer will ultimately only be out of their time, the seller could lose so finances from backing out of the sale.
While some of these set backs may be rare, they can still happen. If you are looking to buy or sell a home, contact the Katie McNeil team today and meet with one of our experiences agents to help your home buying or selling process even easier!