From the date of signing the contract the buyer is usually given 30-45 days for them to secure a mortgage. If by any chance they can’t find a financing on a given date they then need to notify the seller for them to back out of the contract.
If you are a seller, it is important that you keep an eye on this and not wait for the 45 days to lapse. You don’t want to find out just a day or two that your buyer cannot fully fulfill what’s in the contract.
Home Inspection Contingency
The buyer is also given 5-17 days to do a home inspection. If they find anything not to their liking, they can withdraw from the contract unless negotiations are made and new terms are agreed upon.
Once contingencies have passed, the buyer must then complete the sale to avoid their deposit from being forfeited.
While most transactions at this point will close on time, there may still be some unforeseeable events that may hinder the buyer from closing the purchase transaction. This may include one of the following:
- Loss of job/income that will hinder their ability to pay their mortgage or financing.
- A change in their credit score in which may lead to their financing being withdrawn by the lender.
- A buyer may also just change their mind for some personal reasons like illness, divorce or other changes in their situation.