Protecting Sellers from Contract Fall-Throughs
- Adam Garrett
- Aug 30
- 9 min read
While sometimes it can turn out positive, especially when a buyer is being unreasonable, a contract falling through can have a very negative impact on a real estate sale. I've seen where the impact of fall-through exceeded 4% of the purchase price. Steps can be made to avoid that even before listing, some of which are often neglected, not known about as options, or misunderstood. Methods vary on local market, state and local laws, local customs, and more.
Below I'll go over:
Ways to reduce the chances of a contract falling through before you list
Which offer to accept and which to reject
Engaging with buyer contingency-related requests
Staying on top of the contract
Be prepared for a contract fall-through, and in some cases, allow it to happen
1A. Typical ways to reduce the chances of a contract falling through before you list that shouldn't change much based on circumstances before you list:
If you pick just an average quality agent, your risks of leaving money on the table go up drastically. When you need to take care of repairs that a buyer has requested, an average agent is more likely to derail a transaction needlessly by being too demanding with a harsh counter or encourage you to be a pushover needlessly vs a great agent.
Many misunderstand the importance of choosing a great listing agent, not knowing what to look for, and confuse high-volume agents with being the best agents, when high-volume agents aren't always high-value proposition agents, and some of the most high-value agents might not be high-volume.
Let's take a real-life scenario. If you had to choose between an agent with approximately 6 years of experience & 29 closings totaling over $8,200,000 in the past year, and an agent with over 10 years of experience but only 8 closings totaling just under $2,900,000, knowing that the 10-year agent had more total closings than the 6-year in agent, which would you choose? While it wouldn't be true when comparing all agents in each scenario, in this example, I'm actually thinking of myself in my 6th year in business vs myself at the moment. I can say for a fact that I have much more to offer sellers in my 10th year than I did in my 6th, and my volume actually decreased because of the value-added concentrated efforts I wanted to do that weren't possible when I was taking the time to do what was necessary for much higher volume. For instance, in my 6th year in business, I was using an essentially borrowed seller guide from my broker. While it was good, it was not nearly as good as the seller guide that I've created, which is unmatched in SE VA. My marketing has also gotten much more competitive for sellers recently vs what it was in my 6th year in business. For instance, I'm doing unheard of things now, like neighborhood Matterport 3D tours that directly integrate houses I'm selling with a much better camera than I used to use. My area photos now integrate collages at times & signs of locations so that on 3rd party platforms like Zillow, someone who doesn't live in the area can much more readily look up what they are looking at without having to rely on MLS photo captions, which I still also include.
... who won't inflate your value and who will let you know what needs to be done to the interior & what needs to be done to the exterior to maximize profits before you list it.
If the listing agent has any doubts whatsoever on value or the comparable sales don't seem that similar or have a large spread, get a 2nd opinion CMA (even if digital from pictures taken by the 1st agent, something I do at times) or an appraisal. Recognize that niche scenarios could make an honest agent recommend an appraisal or second opinion, while a dishonest agent is more likely not to mention the need for one, no matter how niche the situation or how big of a gamble they're making with your money. A dishonest agent would prefer to make you think they know what they're doing to win you as a client, even if gambling with your money while hoping you'll be clueless.
Let the agent know you're considering taking on credit card interest debt to pay for repairs and an honest agent will be able to better tell you about the possibilities of what you might net with various scenarios.
Your risks of not selling drastically go up depending on whether or not you offer a commission that is competitive for your market or weak for your market.
A study was published by HousingWire. In case it's not clear where it says "0.5", having an under 2% buyer-side commission means you have less than a 50% probability of sale vs a market rate commission. The numbers rapidly go up between there & a typical market rate commission offered.
Select a Great Marketing Package
Some great listing agents have variable marketing packages. Know exactly what marketing the listing agent is offering, the commission rates they are charging, & what tier packages would be the best net for your scenario. If the agent has a la carte options, ask them if they would add any a la carte options if they were you, and why, ideally with data to back it if they haven't provided it already. Honesty is key again with even asking this question.
Be ready to get the house in good shape
While there are some cases where selling as is makes sense, that's typically not the case.
Even if you take care of repairs from a pre-listing home inspection, if you ignore more cosmetic matters of the interior of your house, like cleaning, caulking, and painting, it's easy to leave a lot of money on the table and drag out your sale needlessly. Don't forget to take care of the exterior, either. This area is another one where honest agent candor and expertise are vital.
While I've dealt with a number of appraisal guarantees, on one occasion, my seller received a 6% above-appraisal guarantee in a multiple-offer situation. In that case, the appraiser said that my listing price was exactly the value of the house. I advised that the sellers not take the highest offer, but the one with the highest appraisal guarantee. I was glad I did. We used every penny of it. One of the ways that the seller was able to do that, beyond great marketing and great timing, was by abiding by essentially all of my recommendations. It was a family affair, where even the kids helped. Very little money was spent by the seller to get the house ready, but that sweat equity of cleaning the place up made a big difference.
There are several factors involved here; if there isn't an external compelling reason to sell in the winter, it's generally best avoided, while listing in May in SE VA is prime time.
Do the math in advance with your agent about whether to sell or not.
Honesty is a key agent ethic again here. Count the cost, and be fully committed to selling before going down that path. If your agent isn't unusually honest, it's wise to also consult a financial advisor. A significant % of agents won't dissuade you from selling if you tell them you want to sell.
Do a pre-listing termite/moisture inspection
...& if an area where it's common practice to get a termite/moisture inspection or just the termite inspection (wood destroying inspection)
Consider a pre-listing crawlspace inspection
Even if you don't go with a full-blown pre-listing home inspection, if you have a crawlspace, getting a pre-listing crawlspace inspection could easily be the difference of a contract falling through or not, especially if you haven't had one in the past year.
If in a condo or owner's association, get the packet in advance.
Don't wait until after you list the property to get the packet, even if it means that you risk needing to pay extra to get a renewed packet if the buyer requests a new one. In Virginia, "If a resale certificate was issued more than 30 days but less than 12 months before settlement, the seller or the purchaser, upon proof of being the contract purchaser of the unit, may request an updated resale certificate (§ 55.1-2311.)." However, in Virginia (§ 55.1-2312.) if you have the packet in advance, provide it to the buyer before they make an offer, and if the contract doesn't stipulate otherwise, the buyer has 3 days from the ratification of the contract to either request an updated packet, terminate, or proceed if they do nothing with the association contingency being removed. As long as it hasn't been a long time, most buyers will proceed. Conversely, there are some circumstances where a buyer requests repairs, the sellers start to move out while conducting repairs, and the buyers then terminate due to the association contingency because the seller waits until after the home inspection contingency to be removed to request the packet for the 1st time.
There are some cases where it's important to do some extra due diligence.
If any of the following are involved, this factor becomes even more important:
a retainer fee
heavy marketing expenses/efforts
sale proceeds contributing to a purchase when buying and selling,
staging
1B. Extra steps to take when reducing contract fall-through chances is even more important or in certain circumstances:
Get a pre-listing home inspection
If you're in a situation where a contract falling through could cause significant hardship, it can easily be worth it to get a pre-listing home inspection.
State law also varies here. Some states require a pre-listing inspection of houses. Virginia is a buyer-beware state, so a pre-listing house inspection isn't required.
Some agents advocate always getting a pre-listing home inspection. I'm not one of them in my market, but I do think it's debatable. It can easily mean thousands of dollars you can lose from a contract falling through due to the perception of value and the impact of market time on that value perception. The older the property, and the lower quality the materials for construction, the greater that a pre-listing inspection is warranted. That said, if you're going to get one and do nothing but disclose it rather than treating issues, it would be better not to get one.
Pre-listing inspections are more important in some markets than others. The lower the price range, the lower their likelihood. For properties below $300k, in searches on 8/30/25 totaling 1976 properties for "inspect" in agent & public remarks, .7% of properties (10/1466) in a radius around Hampton Roads & .8% of properties (4/510) in a radius around Greater Richmond had a pre-listing inspection stated in a search combining the primary MLS of each MSA (REIN & CVR). Some pre-listing termite/moisture inspections were also noted.
Get other common inspections
There are a number of other common inspections that may occur in your area, i.e. Radon in some areas.
Note on pre-listing inspections
Pre-listing inspections should be advertised in MLS, either in agent remarks or public remarks, but ideally in public remarks. Don't get a pre-listing home inspection if you don't plan on doing any work, no matter the findings that come up, save in extreme circumstances. What to do after pre-listing inspection is one of the important areas where having a great agent on your side is vital.
Which offer to accept and which to reject plays a heavy role as well in reducing the prospect of a contract falling through. It is something where your listing agent will also play a big role. It's easy for unrepresented sellers to get duped into a wide variety of schemes (i.e. "we be houses" style sales being described as "Patterns of Parasitic Purchasing" by a study) & accept very shaky offers.
Related:
Handling buyer requests based on contingencies, i.e. home inspection and appraisal, is also important to navigate wisely.
Importance of staying on top of the contract:
Staying on top of contractual obligations so that the closing occurs on time and so that the buyer doesn't have a contractual right to terminate due to negligence
It's also important to be prepared for a contract fall-through, and in some cases, to allow it to happen, or even to initiate termination yourself once allowed. One of the top ways to be prepared is to not unstage a house until after the buyer is "clear to close," ideally with all contingencies removed. Agent guidance is critical here. For instance, in a very unusual circumstance, I had a seller terminate a contract with a buyer prior to any other formal response to an unreasonable list of repairs requested after encouraging and securing a much stronger backup offer from another buyer who was paying in cash. Versus what the other buyer was requesting, that saved the seller over 10% of the contract price due to the extreme nature of the other buyer's demands.
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