By: Candice Schott

When a Buyer Walks Away: What to Do Next

That bottle of champagne you put on ice? Hold off on popping it just yet.

In today’s more balanced Toronto market, it’s common for sellers to receive offers that come with conditions—things like financing approval or a satisfactory home inspection. Most of the time, buyers satisfy their conditions within a few days, and the deal moves forward.

But sometimes… they don’t. And just like that, the deal falls apart.

When it happens, it can feel like someone pulled the rug out from under you. But take a deep breath—we’ve got a game plan to help you bounce back.




Why Do Deals Fall Apart?

Let’s break down the most common reasons we see buyers back out in Toronto.

1. Financing Falls Through

Even if a buyer has a mortgage pre-approval, that doesn’t mean they’re guaranteed a loan. Once the bank takes a closer look, issues can pop up, such as:

  • The lender isn’t satisfied with their income, credit, or down payment source

  • Interest rates have changed, making their mortgage more expensive than expected

  • The property’s appraisal comes in lower than the purchase price, and they can’t make up the difference

  • A job loss or income change affects their approval

  • The lender won’t finance that particular condo building

  • They can’t get satisfactory home insurance

And here’s the kicker—most financing clauses in Toronto are worded in a way that allows buyers to walk away if they can’t secure financing, without having to explain why.




2. Home Inspection Issues

If a deal is conditional on a “satisfactory home inspection,” the buyer has a lot of room to back out. They don’t need to prove there’s anything structurally wrong with the house—they just need to say they aren’t satisfied.

What can trigger a failed deal?

  • Buyers getting spooked by standard maintenance items

  • Major unexpected issues that affect financing

  • Disagreements over who should handle repairs

  • Repair estimates that go beyond the buyer’s budget

If a sale falls apart due to a home inspection, your agent needs to gather as much information as possible so you can make adjustments and move forward.




3. Status Certificate Issues (For Condos)

If you’re selling a condo, the buyer’s offer likely included a condition allowing their lawyer to review the status certificate—the document outlining the financial and legal health of the building.

Deals can fall through if the status certificate reveals:

  • A reserve fund that isn’t sufficient for upcoming repairs

  • Lawsuits, insurance concerns, or maintenance fee increases

  • A history of special assessments or other red flags

  • Unexpected condo rules, like pet restrictions or BBQ bans

And here’s the tricky part: if the buyer’s lawyer finds something concerning, they don’t have to explain. They can just walk away.




What Happens Now?

The Deposit & Mutual Release

If the deal falls apart during the conditional period:

  • The buyer typically gets their deposit back

  • Both sides sign a mutual release, freeing each other from liability

  • If there’s a dispute, the deposit remains in trust until it’s resolved

A word of advice: don’t sign off on releasing the deposit until you’ve discussed your options with your agent or lawyer.




Time to Execute Plan B

Your REALTOR® should immediately:

  • Investigate any unexpected issues that came up during the home inspection

  • Follow up with any serious buyers from the first round of showings

  • Reach out to agents who previously showed the property to gauge interest

  • Re-evaluate the price or adjust the listing based on feedback

  • Refresh photos, staging, or marketing if needed

One advantage in Toronto is that sale prices aren’t made public until a deal officially closes. This means only you, your agent, and the buyer’s side know the price you originally agreed to. Use that to your advantage when repositioning your home.




What About Backup Offers?

If you received multiple offers the first time around, now is the time to:

  • Have your agent reach out to those buyers immediately

  • Be transparent about the situation without revealing too many details

  • Consider whether terms—like a flexible closing date—might be more important than price

  • Be prepared to negotiate, since previous offers may not still stand

If you accept a conditional offer, it’s almost always a good idea to keep showing the property. It’s a little inconvenient, but it increases your chances of securing a backup buyer.




The Emotional Reset

A failed deal stings, but here’s how to move forward:

  • Give yourself a day to be frustrated, then refocus on strategy

  • Remember that many successful sales have a false start

  • Use what you’ve learned to make your listing even stronger

  • Treat each new showing as a fresh opportunity, not a setback




Moving Forward

A deal falling apart doesn’t mean your home won’t sell—it just means this wasn’t the right buyer. Plenty of successful sales start with a false start. Stay focused, trust your agent’s guidance, and know that the right buyer is still out there.

And that champagne? Keep it chilling. When the right deal comes together—and it will—it’ll taste even better.