- November 25, 2024
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My Grand Haven house is for sale again after a cash contract with no contingencies fell through within two weeks of the scheduled closing.
Once my wife and I completed our move from our home in Grand Haven, to a condominium in Tidelands, I did a thorough cleanup of the house inside and out to prepare it for sale. I knew that a vacant house would be more difficult to sell, but Shirley and I have collectables and family pictures everywhere. There are so many pictures of children and grandchildren on our refrigerator that you can barely tell what color it is. Of course, these are precisely the types of items real estate practitioners recommend sellers remove before listing their homes.
To avoid the negatives of vacant rooms, we had the house partially staged. Staging involves anything from strategic placement of home accent pieces (which we did) to completely furnishing one or more rooms. Staging helps differentiate your unoccupied home from similar but empty homes.
We were rewarded with a purchase contract within two months. Even better, the contract was a cash offer with no contingencies. The inspection was benign. All we had to do was sit back and wait for the closing.
Along came the big surprise. The buyer was foreign, and apparently the country’s wild currency fluctuations and strict regulations governing currency conversion doomed the closing. The buyer had no choice but to withdraw from the contract.
Because the contract had no contingencies, the withdrawal constituted a default. The buyer forfeited the escrow payment. While the amount was sufficient to soften the blow to us, the extended selling cycle created by the contract default will entail additional carrying costs and expenses. The house has been relisted, but two months of the prime selling season were lost while it was in the “pending” status.
Locally, more than half of all single-family home sales through the Multiple Listing Service are reported as cash sales. Flagler County Clerk of Courts Gail Wadsworth confirms the ratio, reporting that her staff registers twice as many deeds as mortgages monthly.
With no financing contingencies, cash contracts that fail to complete are more likely to result in forfeiture of the escrow deposit. Sellers should attempt to ensure that the escrow deposit is sufficiently large to compensate for the lost selling time and the associated additional carrying costs. Remember, it’s not over till it’s over.
