Buyer Cancelled Twice: How a Chandler Seller Closed on the Third Escrow
Gabe and Brittany bought a bigger home in Queen Creek first, using a bridge loan, before their Chandler home sold. Then the Chandler home went under contract twice and fell through twice. A sewer line and an aging roof scared off the first buyer. A family need ended the second. The third buyer closed in March. Because they had moved first, the delays cost them patience and not a place to live.
Why did Gabe and Brittany buy before they sold?
They had just blended two families and needed a bigger home with a pool and a real backyard. Gabe owned a Chandler house. Brittany owned a Gilbert condo. Both had to sell to pay for the new place, and Brittany travels for work most of the week.
They did not want to sell first and then scramble. So we used a Flyhomes bridge loan to buy the Queen Creek home with an offer that did not depend on selling anything. It cost a fee, and I said so plainly. It is the milk run on Christmas Eve. You pay gas station prices for the convenience, and that night it is worth it. For them, it also beat the cost of moving twice and renting in between.
What happened to the first two buyers?
The first buyer cancelled after the inspection. Two things drove it: a sewer line blockage and a roof that needed full replacement.
The second buyer went under contract soon after and cancelled during the inspection period for a reason that had nothing to do with the house. A family member could not safely climb the stairs. There was nothing to negotiate and nothing to fix. The deposit went back to the buyer, as it should under the contract.
I told Gabe and Brittany this is the most stressful part of selling a home, and that we would get through it. They were already living in Queen Creek, so this was a setback and not an emergency.
What did we change for the third buyer?
The third offer came in at a price close to our ask, and the same two issues were back on the table. This time we were ready.
I send the earlier inspection reports to serious buyers before they write an offer, so they go in with eyes open. A buyer who has already decided to write an offer takes bad news better than a buyer scrolling listings.
The buyer’s agent also did not want a loose credit for the sewer line. It felt like a blank check for unknown problems. So I had the sewer line hydro-jetted and rescoped. The scope showed a pipe problem at the property line, and a known problem with a known price is much easier to negotiate than a scary unknown. We settled on a roof credit and a plumber paid at closing.
Why did I talk them out of fixing the roof and relisting higher?
Brittany asked a smart question after the second cancellation. Why not replace the roof and relist at a higher price?
I told her I rarely see it work. Buyers and appraisers expect a roof to be sound, so a new one does not raise the price by what it costs. You spend the money either way, and the only difference is more months of carrying costs. The market had already told us where the home was priced, and we had a willing buyer. I told her to pull the band-aid off, and that it was still her call. They went with the credit.
How did the bridge change the way two cancelled escrows felt?
The bridge did not make waiting free. Two homes cost real money each month. What it did was take the deadline off the table.
When a seller has to buy a home by a certain date, a cancelled escrow feels like a threat, and sellers take weaker offers to beat the clock. Gabe and Brittany were already in their new home. We could choose a good offer and not a fast one. The Queen Creek home closed in November. The Chandler home closed in March.
What would I tell a seller whose buyer just cancelled?
There will always be another buyer. It stinks, and we can still get it sold. First we look at why. If an inspection finding drove it, we address that, because it will come up with the next buyer. If the buyer got cold feet or asked for something outlandish, we talk it through. It is case by case.
Buyers get nervous and overwhelmed, and it happens often. The good news is that you now know more and have more levers to pull. And if we exhaust the negotiation, we are where we are, and we keep going forward.
Frequently asked questions
What should a seller do right after a buyer cancels?
Read the reason first. If an inspection finding caused it, deal with it before the next buyer finds it. If it was personal or an unreasonable ask, relist and move on.
Does the seller keep the earnest money?
Usually not. A buyer can generally cancel for any reason during the inspection period and get the deposit back. Check your contract and talk to your agent and title company.
Should I fix a big item like the roof and relist higher?
In most cases no. Buyers expect a sound roof, so the repair rarely adds back what it costs, and you pay carrying costs while you wait.
Should I share old inspection reports with the next buyer?
I send them to serious buyers before they write an offer. They go in informed, and fewer deals die in the inspection period.
Ben Graham, real estate advisor serving South Tempe and South Chandler. REALTOR since 2011 with more than 500 homes sold, including move-up families who bought first and sold second.
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