When your buyer's chain collapses: what to do next
A collapsed chain is not the end of the sale. It is a setback, and what you do in the first week decides how expensive it becomes.
Around a third of agreed sales do not complete, and the commonest cause is a failure somewhere else in the chain. The buyer's own buyer loses their mortgage, or their buyer pulls out, or a survey reveals a problem further up. None of it is your fault and all of it costs you time.
The first decision is whether to try to save the sale or to return to the market. That depends on how far along the sale is and how strong the buyer is, and it is worth establishing both before deciding.
Establish exactly what has failed
Vague information leads to bad decisions. Ask the agent to establish, in writing, what specifically has broken and what the buyer's position now is.
- Whether the failure is in your buyer's own sale or further down the chain
- Whether your buyer still wants to proceed and can fund the purchase without selling
- Whether the buyer's mortgage offer remains valid, and for how long
- How much of the conveyancing has been completed, because that work is not wasted
- Whether the buyer is willing to exchange before the chain is repaired
Keeping the sale alive
If your buyer is genuine and only their own sale has failed, there is often a way through. The strongest move is to push for exchange on your sale with a delayed completion, so your transaction is legally binding even if the rest of the chain is not settled.
Where the buyer cannot proceed without selling, the alternatives are a bridging loan on their side, or a reduction in price that lets them proceed. The second is a real cost to you and should be weighed against the cost of re-marketing.
Returning to the market well
If the sale is dead, the priority is speed and honesty. Tell the agent to relist immediately, contact everyone who viewed and expressed interest, and be upfront with new buyers about why the previous sale fell through. Buyers find out anyway, and a straightforward explanation is far less damaging than a vague one.
The conveyancing work already done has value. If the searches and enquiries are complete, a new buyer's solicitor can often rely on them, which removes weeks from the process and is a genuine selling point. Say so in the marketing.
Common questions
- Can I keep my buyer's deposit if the chain collapses?
- Only if contracts have already been exchanged. Before exchange there is no binding contract and no deposit to forfeit, which is why a collapse before exchange costs you time rather than money. After exchange, the buyer is contractually committed and the deposit is at risk if they fail to complete.
- Should I reduce my price to keep a buyer?
- Only if the reduction is smaller than the cost of starting again. Re-marketing costs you the time on market, the momentum, and often a few per cent of the eventual price. Put a figure on that cost before deciding, and treat the buyer's request as a negotiation rather than a demand.