Top 5 Reasons Why Homebuyers Hesitate To Buy
Actually, it’s not uncommon for home purchases to stall or even fall through. This is mostly due to issues that need to be addressed by one or both parties.
Below are top 5 reasons why homebuyers hesitate:
1. Financing Approval
One of the top reasons for hesitation is financing approval. Before buyers can purchase a house, they need to be approved by the lending company. In this instance they need to comply with the lender’s requirements so that their application can be approved.
In some cases, approval gets stalled when there is a lack necessary documents or insufficient credit or employment history. Borrowers or potential home buyers need to have good credit score, low debt, a good sized down payment and a solid employment history to qualify for a loan. Buyers that are considered as “high-risk” by banks and lenders can get denied or stalled in their financing application.
2. Title Fraud
There are houses that sell but who owned the house when it was sold? Title fraud is a serious problem in real estate.
Before selling or buying a house buyers may want to make sure with a title company who really owns the house. If the title is clear i.e., no pending liens etc then the title company will be able to issue insurance to protect the lender or owner from claims against the property should disputes arise over ownership.
3. Undisclosed Issues/Problems With The House
A leaky roof, termites and other problems or issues with the house which were undisclosed can seriously stall a deal. Most buyers want a house that is ready to move in. Before buying a house many of them conduct a home inspection to ensure that they are buying a “quality product”. This is perfectly normal since houses are expensive.
If they have discovered any undisclosed problems in your property, they may want to renegotiate the price to address any repairs they have discovered.
4. Misconception About Down Payment
Many first time buyers hesitate to close the deal because they believe that you need 20% down payment to get a mortgage. However, this is not true anymore with FHA loans. Buyers need to be educated about the resources available to them depending on their specific situation.
5. Stability of the Future Market
Unstable market makes for hesitant buyers. This is perfectly understandable because this makes investing in real estate more risky. Take the 2008 Recession for example where many people lost their homes. Many people don’t want this kind of experience so hesitating or exercising more prudence is normal should buyers feel that the market is unstable or risky.
It is perfectly normal for buyers to be nervous about a home purchase. Whether they are upsizing or downsizing there are many “what ifs” going through their mind. One of the ways to keep buyers interested is to prepare your property for sale. Learn more here on How To Sell Your House in the Twin Cities.