Real estate transactions often represent one of the largest financial commitments in a person’s life. Whether it’s a first-time homebuyer or a seasoned investor, everyone enters the deal with the goal of closing successfully. But, why do real estate closings fall through? As a Massachusetts real estate attorney, I’ve seen transactions unravel for a variety of preventable reasons. Here are the top five most common reasons home sales fall through, and what buyers, sellers, and agents can do to keep the process on track.

1. Financing Falls Through

Even with a pre-approval letter, buyers can run into issues securing final mortgage approval. Changes in employment, credit score fluctuations, or large purchases during the closing process can derail financing.

How to prevent it:

Buyers should avoid making major financial changes until after closing. Sellers and agents should insist on working with buyers who have solid pre-approvals from reputable lenders. Attorneys should ensure financing contingencies are clear and enforceable in the Purchase and Sale Agreement.

2. Unresolved Title Issues

Title defects such as old liens, boundary disputes, or unknown heirs can delay or completely derail a sale. In Massachusetts, common issues include improperly discharged mortgages or missing trustee certificates in trust-owned properties.

How to prevent it:

A thorough title search early in the process is essential. Sellers should work with an attorney to identify and address title issues before listing the property. Buyers should only use experienced closing attorneys who can spot and resolve potential problems quickly. Learn more about titles here.

3. Inspection and Appraisal Problems

Inspections can reveal significant defects—from faulty roofs to cracked foundations—that make buyers think twice. Separately, an appraisal that comes in below the offer price can force renegotiations or cause financing to fall through.

How to prevent it:

Sellers should consider pre-listing inspections to uncover red flags early. Buyers should hire experienced inspectors, and understand their rights to negotiate or exit the deal based on inspection findings. If the property is unique, appraisals should be discussed early, particularly in competitive markets like Boston-area real estate.

4. Inadequate or Missing Paperwork

Massachusetts real estate deals require several key documents, including: deeds, smoke/CO certificates, 6D certificates for condos, and more. Missing or incorrect documentation can cause delays or even prevent closing.

How to prevent it:

Work with a real estate attorney from the beginning. Attorneys ensure all documents are accurate, filed properly, and available before closing.

5. Cold Feet or Unrealistic Expectations

Sometimes, a deal collapses due to emotion. Buyers or sellers might get nervous, especially in competitive markets or if they feel they’re not getting a “fair” deal. Unrealistic expectations about pricing, timelines, or repairs can also sour a transaction.

How to prevent it:

Clear, consistent communication is key. Agents and attorneys should educate clients about market realities, contractual obligations, and timelines. Setting expectations upfront—especially in multi-offer situations—helps clients make confident, informed decisions.

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Conclusion

Real estate deals are complex, but many common pitfalls can be avoided with proper planning, clear communication, and the right legal guidance. As a Massachusetts real estate attorney, I work closely with buyers, sellers, and agents to ensure that transactions close smoothly—and to step in quickly when something starts to go off track.

Have questions about a current or upcoming real estate deal? Contact Liz Barletta at Ligris + Associates.

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