Seller Mistakes to Avoid When A House Is Under Contract

February 16, 2024

Tim Clarke

Expert real estate advice on avoiding pitfalls when selling a home under contract, plus tips on choosing the right agent for a smooth sale.

For sellers, you have your own considerations to keep up with in order to prevent your house from sitting on the market for longer than absolutely necessary.

As with any real estate transaction, it is imperative that you have representation that can assist during every step of the process, ensuring nothing gets missed.

Let’s take a look at 10 seller pitfalls that may be encountered for a house under contract.

Seller Loses Motivation To Sell

It isn’t entirely uncommon for a seller to change his/her mind about selling after going under contract. A residential real estate transaction is a very emotional process.

On the seller’s side, if there is any attachment to the property, the seller may be reluctant to sell during the process.

The house could’ve been owned by a family member that was no longer to fit to live inside of the house.

Another situation could be a marriage that has been reconciled at the very last minute.

The seller could have had a financial hardship that could’ve been resolved by selling the house and maybe the seller managed to save the house.

There could be a number of other reasons as well: job transfer does not go through, reconciles marriage, divorce, etc.

Regardless of the situation, If the seller fails to meet his/her duties to complete the transaction, the seller will be in breach of  contract and typically, earnest money due diligence and expenses gets reimbursed to the buyer.

Seller Cannot Find A Suitable Replacement Property

One of the biggest reasons why we have low inventory in the Raleigh Durham triangle market is because of increased demand, which has led to rising home values.

Many sellers within our market are reluctant to sell because they are faced with deciding to enter the market and compete with other buyers for their next house.

In addition to rising demand, sellers who are already in the market are less inclined to accept a contingent offer because they don’t want to have to worry about the uncertainty of the buyer's house selling.

This puts a strain on the transition process of a contingent buyer, so the buyer would have to make the decision to sell their home before finding and securing another suitable home.

Seller Does Not Allow Appraiser Inside Home

Rising housing demand with a short supply causes a very uncommon appreciation rate.

Over the past couples years in the Raleigh Durham Triangle market, appraisal values have been struggling to keep up with demand.

Appraisers have been forced to use several different methods of determining value simply because the comparative market analysis approach has been consistently ineffective in determining value.

Other factors aside from I comparative sales have been considered.

What places are now considering days on market, market trends, the amount of offers received and sometimes the appraiser will inquire to the listing agent about the amount of showings.

Real estate is a ”free market,” meaning that a purchase is only worth what a buyer is willing to pay for it.

The difference between what a realtor can do versus what an appraiser can do is that an appraiser can assign values to various characteristics of a house.

Nevertheless, those value assignments are deemed as an opinion.

If an appraisal falls short and the seller refuses to reduce the purchase price then the buyer has an option of paying the difference in cash.

A buyer making up the difference of a short appraisal typically happens in a strong sellers market.

If the buyer is an FHA or VA buyer then that bar is entitled to a full refund of earnest and due diligence if the home fails to appraise.

Will Not Allow Inspectors Inside The Home In A Timely Manner

A real estate purchase transaction requires full cooperation from all parties involved. It is imperative for the seller to allow the buyer and the buyer’s vendors to assess the property.

If an inspector is denied access to inspect the property, then the timeline in which negotiations occur can be greatly impacted.

Scheduling for different vendors to assess the property needs to happen almost immediately after going under contract to a lot for any setbacks or delays.

Not only does the defects need to be addressed, there needs to be an agreement (in writing) about how those defects will be handled.

If there is a delay in inspections Ennis at the fall of the solar, it is customary to and fair to extend the due diligence deadline.

If the due diligence deadline passes and the repairs are not agreed-upon then the buyer has committed to purchasing the home without receiving any remedies or concessions for the defects.

Removes Property From The Premises The Buyer Believed Was Included

Once under contract, The buyer is expecting to complete the purchase of the home and the condition should be in the same shape or in better shape as it was at the time of showing.


Sellers need to make sure they do not remove more property than is expected from the property they're selling.

Seller Is Unable To Clear Up Liens Against Their Property — Short On Cash To Close

It is a sellers responsibility and a purchase transaction to clear up any liens or encumbrances to the property.

If the seller fails to do so, then the seller doesn’t have “marketable title” and at that point, the seller is considered to be in breach of contract.

If the seller breaches the contract by not having marketable title, the buyer is entitled to a full refund of earnest money and do diligence and a reimbursement of all expenses associated with the purchase process.

Leaves Town Without Giving Anyone Power Of Attorney

Closing documents need to be notarized to eliminate the possibility of fraud.

Sometimes, the closing date isn’t the most ideal date for the seller, so several solutions are available when a buyer or seller cannot attend the closing.

If the buyer or seller leaves town they will need to set up a Power Of Attorney. A Power Of Attorney (POA)  is a person who is assigned to sign off on legal documents on behalf of another person.

The process for signing a power of attorney may be lengthy so it is ideal to establish a POA as soon as the seller confirms that they cannot attend the closing.

Seller Did Not Complete The Repairs Agreed To In Contract

Within the due diligence period, the buyer will get a series of inspections done. If and when the buyer asks for repairs, the buyer will fill out a due diligence repair request form.

This is done to ensure that the house's condition is agreed-upon before the transaction is finalized.

If the seller signs a diligence repair request form then the seller has agreed to make the repairs.

That agreement becomes an addendum to the purchase contract, thus the seller will be in clear breach of the agreed repairs aren’t completed.

Seller Misrepresents Information About Home & Neighborhood To The Buyer

Before a buyer makes an offer on the listing, the buyer has an opportunity to review a property disclosure form.

The property disclosure form is a form that mentions any seller known defects to the house and property.

This document holds significant weight because it opens up a conversation between the seller and the seller’s agent.

Any missed information will be to the liability of the listing agent. Buyers must carefully review the known possible defects and discuss with their agent before going under contract.

The real estate agent could be in big trouble if they omitted a material fact, willfully misrepresented a material fact or neglectfully misrepresented a material fact.

If the seller and the agent does not disclose all hidden or unknown defects and they are subsequently discovered, The buyer may feel cheated and would elect to terminate.

Builder Miscalculates Completion Date Of New Home

If you are purchasing to build, this applies to you.

Many builders have their own purchase contracts. It is critically important to use a real estate agent when negotiating with a builder. Builder contracts tend to be vague and arbitrary.

Needless to say, having a buyer’s agent to assist is free of charge because the builder always pays the commission.

And a builder purchase contract, they will always have provisions to protect them in the event of a completion miscalculation.

If the builder misses any deadline dates, there is usually language that offers very little concession to the buyer for the inconvenience.

At that point, it’s up to the buyer if they wish to continue with the purchase.

Final Thought

After 17 years in the real estate business, I've seen countless home sellers make mistakes that sabotage their own sales.

As founder of the Tim M. Clarke Team, my top priority is ensuring clients have a smooth, stress-free selling experience.

My advice? First, it is extremely important for Home Sellers to have proper representation.

There are far too many circumstances that could occur to a person who is unaware of the requirements for keeping the entire process from unnecessary risk.

Second, understand that the buyer's professional inspections likely will find defects; expect some renegotiation. Don't take it personally.

Third, don't make significant purchases that affect your financial status until after closing. This avoids snags with your buyer's financing.

Finally, lean on an experienced real estate agent you trust for guidance.

My team simplifies transactions through expertise and comprehensive service.

Selling your home is a major financial move; having a knowledgeable advisor protects your interests so you can enjoy the process. Contact me today to maximize your sale and referrals.

FAQ

What are the most common mistakes sellers make once their home is under contract?

The most common mistakes are stopping marketing and promotions, taking the buyer's inspection personally, and making large purchases that affect their financial status.

How can sellers avoid sabotaging their own home sale?

Sellers can avoid sabotaging their sale by continuing to market the home to get backup offers, understanding that the buyer's inspection will likely find defects and require renegotiation, and avoiding large purchases until after closing.

Why is it important for sellers to keep marketing a home that is under contract?

Marketing a home under contract can create leverage with backup offers to help push along an existing contract. It also provides a safety net if the current contract falls through.

What should sellers do if the buyer's inspection uncovers defects?

Sellers should expect that the buyer's professional inspection will likely find defects that require some renegotiation. It's important not to take this personally as it is standard procedure.

How can sellers manage their expectations regarding home inspections?

Sellers can manage expectations by realizing that renegotiations after a home inspection are common and do not necessarily reflect on the condition of the home. A real estate professional can help provide perspective.

Why should sellers avoid large purchases before closing?

Large purchases can negatively affect a seller's financial status, which can cause issues with the buyer's financing and potentially jeopardize or delay the sale.

What is the benefit of working with an experienced real estate agent?

An experienced real estate agent can provide expertise to simplify transactions, guide sellers through common pitfalls, and protect the seller's interests throughout the entire selling process.

How can an agent make the selling process smoother?

Agents can make the process smoother by managing paperwork, disclosures, and negotiations, marketing the home, screening buyers, and providing insight on pricing, terms, and timelines based on market conditions.

What should sellers look for in selecting a real estate agent?

Sellers should look for an agent with extensive experience, a proven track record of success, strong local market knowledge, and exemplary client service and communication skills.

Vetting reviews is also recommended.

Why is it advantageous to work with a real estate team versus a solo agent?

A real estate team can provide sellers with more comprehensive service, broader expertise, and added assurances that their sale will be handled efficiently even if an individual agent is unavailable.

Tim M. Clarke

About the author

17 years as a Realtor in the Research Triangle, Tim seeks to transform the Raleigh-Durham real estate scene through a progressive, people-centered approach prioritizing trust & transparency.

Contact Us

Looking to build / buy / sell in the Triangle? Drop us a line.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.