You’re just weeks or days from closing on your new home but you have doubts. Something just doesn’t seem right, and if you’re a first-time homebuyer you could think you’re just imagining things or maybe it just FEELS like this. No, it shouldn’t. This is perhaps the biggest purchase of your life and you should approach it with confidence, excitement, and purpose.
So back to those doubts. There are definitely reasons to back out of a home purchase and, if you’re facing one of them — run! Those red flags may come back to haunt you.
Related: Tips for Buying a Home “Sight Unseen”
Here are five reasons you might want to reconsider a home purchase.
1. An Inspection Red Flag
So there are cosmetic issues (that horrible wallpaper) and then there are real structural problems you need to think about — a lot. Don’t ever ignore a major red flag on the inspection report, such as sagging floors, cracks in the wall, or roof or drainage issues. A structural problem like that can quickly turn your dream home into a money pit. Foundation repairs, for example, can cost tens of thousands of dollars. If it’s been pointed out in the report, you’ll want to consult a structural engineer to find out what the real cost will be. If it’s out of your budget, it’s time to walk away. If you have a home inspection contingency, you can back out based on the results of your home inspection — but only within the time frame specified in your purchase agreement.
2. Builder Sloppiness
If you’re looking around a newly built home and your first thought is how sloppy it looks, rethink your purchase. You might notice something like a fresh paint overspray on the inside or outside of window trim and light fixtures, which could mean the builder is trying to cover up inconsistencies in the finish. And if the painter the builder hired was sloppy, what about the carpenters, plumbers, and electricians? If you’re going to spend good money, get your money’s worth and walk away from the low-budget builder.
3. Title Problems
Issues with your title — from missing heirs to an illegal deed filed years ago — can take years and thousands of dollars in legal expenses to resolve. Fortunately, title insurance (required in most transactions) will protect you from this kind of thing. But if the title company can’t give you title insurance for the property, be ready to start looking for another house. These are problems nobody needs in their life.
4. Environmental Contamination
There are a lot of building materials that were used years (or decades) ago that we now know can cause health issues. You’ll want to steer well clear of them. Homes constructed from the early 1940s to the 1970s, for example, could contain asbestos or lead-based paint — both of which may cause serious health problems and take tens of thousands of dollars to repair. Other environmental issues include a faulty septic system, which can contaminate drinking water or cause mold issues. Remediating mold can cost from $500 to over $6,000 depending on the type of mold. A professional will need to come in, collect spores, and look at them under a microscope to see what is in the home and give you an estimate on the cost to remediate it. If you’re having second thoughts because of an environmental concern, move on.
5. Bad Neighbors
It could be that barking dog at your fence 24/7 or a front-yard full of trash. Having good neighbors matters. You’ll want to consider the neighborhood carefully and visit at different times of the day to root out any potential problems. It’s going to make daily life difficult if your neighbors are obnoxious, and it can also affect how quickly (or for or how much) you can sell your home when you do eventually decide to leave.
It can be hard to walk away, especially if you’ve already sold your old house and need somewhere to live. But the cost of buying a house with built-in problems is far too high. You’ll be stuck repairing and paying for items you never expected. And you could waste a lot of money in the long run.
This is why having the right contingencies included in your purchase agreement is so important. While it’s still possible to back out of a home sale without having that contingency, you’re putting yourself at risk of losing your earnest money and possibly opening yourself up to legal issues.
Contingencies are there to protect you from common issues — red flags discovered through an inspection — you can run into during the home-buying process.
So listen to those nagging doubts (as long as they’re rooted in facts) and if it’s time to back out don’t think twice. Do it.
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