Ingrids Blog

32 Possible Causes for a “Dead” Transaction

Nowhere is Murphy’s Law more prevalent than in real estate, simply because when you consider the length and complexity of any transaction, there are usually several opportunities for something – anything – to go wrong. The list below is NOT comprehensive; it’s simply more commonly cited reasons for a “dead” transaction.

This is a partial list of challenges a Buyer or Seller can face during the qualification stage alone to jeopardize the transaction if he or she:

1. Falsifies information on the loan application.

2. Submits inaccurate personal or financial data to the lender.

3. Late payments in previous 12 months on credit report.

4. Assumes additional debt after date of loan application.

5. Experiences change in employment status.

6. Co-borrower (if any) experiences change in employment

status.

7. Income verification lower then stated on loan application.

8. Overtime income disallowed for underwriting purposes.

9. Charges large purchase on credit before closing.

10. Experiences severe financial setback during escrow.

11. Lacks motivation.

12. Gift donor revokes payment.

13. Cannot locate divorce decree.

14. Cannot locate petition or discharge of bankruptcy.

15. Cannot locate tax returns.

16. Cannot locate bank statements.

17. Fails to provide verification of rent.

18. No longer qualifies for a home loan due to rise in interest rates.

19. Loan terms adjust to higher rates, points or fees.

20. Does not disclose child support payments on application.

21. Buyer of Seller is a foreign national.

22. Has declared bankruptcy within the last 2 years.

23. Debt-to-income ratio exceeds 50%.

24. Does not have steady 2-year employment history.

25. Submits handwritten pay stubs.

26. Switches to job requiring probation period before closing.

27. Switches to job from salary to 100% commission-based income.

28. Receives disapproval of the house from family or friends.

29. Believes the property has been misrepresented.

30. Expends funds due at closing.

31. Does not properly document additional gift money.

32. Does not provide cashier’s check to a title company for closing

costs and down payment.