During market uncertainty, both buyers and sellers may encounter unforeseen challenges, such as decreased home values or deal cancellations. Economic volatility can prompt buyers to break agreements more frequently, while sellers might need to adjust their expectations regarding their home's selling value. So, what happens when a real estate deal falls through?

Here are five key considerations for buyers and sellers when facing issues in a real estate transaction:

Consequences if Buyers Cannot Close: If a buyer cannot close on a home sold for $800,000, the seller will relist the property. If the new sale is for $750,000, the seller can sue the original buyer for the $50,000 loss, plus interest and legal fees. Disposition of the Buyer’s Deposit: The buyer’s deposit is held in the listing brokerage’s trust account. The seller must sue to recover it. Even if the seller resells the property at the same price or higher, they can still sue and keep the buyer’s deposit. Buyer Changing Mind About Deposit Payment: If a buyer signs an Agreement of Purchase and Sale but decides not to pay the deposit, the seller can still sue for any resale losses and the unpaid deposit. Collecting Owed Amounts After Winning a Lawsuit: Collecting from a buyer after winning a lawsuit can be uncertain. Each situation varies, and obtaining a court victory may take years. Sellers must pay legal fees upfront, and even after a judgment, the buyer might be unreachable or lack assets to satisfy the judgment. Sellers should carefully consider whether to sue. Negotiating an Extension of the Closing Date: An extension can benefit both parties. Buyers get more time for financing or selling their current home, while sellers can negotiate terms such as an additional deposit, interest on the outstanding balance, or the immediate release of the initial deposit. This secures the seller’s position if the buyer still cannot close on the new extended date.