{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.getloans.com\/blog\/losing-fees\/#BlogPosting","mainEntityOfPage":"https:\/\/www.getloans.com\/blog\/losing-fees\/","headline":"Losing Fees Paid For Services When A Loan Does Not Close","name":"Losing Fees Paid For Services When A Loan Does Not Close","description":"Fees paid during a home buying process are at risk? Every now and again a loan does not make it to closing. Common reasons for this are home inspection issues that cannot be resolved or a condo that cannot be approved. Unfortunately, some of these issues arise and cause a deal to cancel after some […]","datePublished":"2016-01-06","dateModified":"2025-03-16","author":{"@type":"Person","@id":"https:\/\/www.getloans.com\/blog\/author\/brianm\/#Person","name":"brianm","url":"https:\/\/www.getloans.com\/blog\/author\/brianm\/","identifier":2,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/b03dd1a5c12d48f4023463adfa5dbd6d38ebf6f4d842bd8f8d55ec71cb0ca275?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/b03dd1a5c12d48f4023463adfa5dbd6d38ebf6f4d842bd8f8d55ec71cb0ca275?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Person","name":"Brian Martucci","image":{"@type":"ImageObject","@id":"https:\/\/www.getloans.com\/wp-content\/uploads\/2026\/06\/brianmartucci-getloans-logo2017.webp","url":"https:\/\/www.getloans.com\/wp-content\/uploads\/2026\/06\/brianmartucci-getloans-logo2017.webp","width":400,"height":70}},"image":{"@type":"ImageObject","@id":"https:\/\/www.getloans.com\/wp-content\/uploads\/2013\/02\/house-for-sale.jpg","url":"https:\/\/www.getloans.com\/wp-content\/uploads\/2013\/02\/house-for-sale.jpg","height":1920,"width":1920},"url":"https:\/\/www.getloans.com\/blog\/losing-fees\/","about":["Home Buying Process","Sales"],"wordCount":1216,"keywords":["appraisals","home buying process","losing fees"],"articleBody":"Fees paid during a home buying process are at risk? Every now and again a loan does not make it to closing. Common reasons for this are home inspection issues that cannot be resolved or a condo that cannot be approved. Unfortunately, some of these issues arise and cause a deal to cancel after some services have already been performed and therefore have to be paid for. And this is where debate will sometimes arise. The debate is related to fees paid during the home buying process.Sometimes a client will be surprised that they are responsible for paying any fees at all when an attempted home purchase fails. After all, they have done nothing wrong. They moved forward with due diligence and good faith. Why should they have to pay for anything? But most times homebuyers understand there are some sunk costs when attempting to buy a home.A story from ZillowI saw a post in the Zillow mortgage forum. A potential homebuyer felt the lender should have known a condo he was trying to buy was not able to be approved as soon as possible. He felt the lender should refund his appraisal fee for not knowing this before the appraisal was completed. Some realtors responded on this forum that they felt the lender should reimburse the potential homebuyer\u2019s appraisal fee.To say the news about problems with a condo should have been uncovered early is simply being unaware of the entire process. It suggests people do not know in what order things take place.There are a lot of moving parts as to the order of a loan process and how fast a loan goes.For example:How fast did the consumer apply from the date of contract ratification?Did the consumer sign their loan disclosures quickly?When supporting documents were requested did the consumer provide them quickly? And completely?Most importantly, how fast did the property manager respond to the lender’s request for the condo information?The condo questionnaire, budget and any other related condo documents are needed for the lender to make a determination on the condo approval. Then and only then should the lender be able to make a decision on the condo approval.If the lender had the condo documents back for a long time and did not notice that condo had problems, that is a problem. To then let the appraisal get turned in, and then let the condo get rejected, that is a problem. The consumer should not get charged for the appraisal. The lender delayed things, and should be responsible.What if an appraisal is completed before the condo documents are received? Then the consumer is dealing with an excellent lender who moves quickly. That is a lender gets the appraiser out to the subject property as soon as possible. This is to meet the demands of the sales contract. Specifically the appraisal contingency deadline. Realtors would be screaming if the appraisal was not done within the contractually required time periods. These are the same realtors who would say the lender is at fault and should give you your money back.Can you have it both ways?You can’t have it both ways. Work with an efficient lender who keeps you contractually compliant and wants to get you to the settlement table on time. Or work with someone who moves slowly and puts you at contractual risk of being in breach of contract, but maybe allows you to save a little bit of money on the appraisal if the deal does not work out.Even had if the lender received all the condo documents and condo questionnaire back from the property manager early before the appraisal was completed, there is an issue. By that time usually the appraiser will have at least been out to inspect the property. What if you cancel an appraisal order after the property has been inspected but before the appraisal itself is completed? You’re still going to pay the bulk of the appraisal fee to cover the physical inspection of the property. I canceled an appraisal after the appraiser had already been out to the home. But they still charged $275 out of a $400 fee. And I only saved the client $125 by canceling the appraisal early after uncovering a condo problem.Do you have to spend money when attempting to buy a house?Are you not willing to risk some money when buying a home? Then you need to pay to have the condo questionnaire and all the condo documents delivered before you write an offer. That costs anywhere from $100-$350 to get all of that for most condos. So you’re still putting money at risk. In many business transactions you’re going to have to put a little money at risk to do some things to do your due diligence to vet the deal. It’s just the nature of business.Shouldn’t the seller of a condo know if there is a problem?It is not common for a seller or listing agent to vet his or her own condo listing when listing it for sale. I think they should. But what I think and what the marketplace does are often not in agreement.I just did a condo loan where the listing agent lived in the building, had a listing in the building, and had no idea there was litigation against the condo! And litigation is a problem when getting a loan. Turns out the lawsuit was a nuisance suit. So we approved the loan, but the buyer could have lost appraisal fees, condo questionnaire fees, and home inspection fees had we not been able to do the loan. So who would have been at fault in this case? The seller? The listing agent? We as the lender? The buyer agent? The answer is none of the above. If you want to avoid wasting money, then a condo buyer has to do as much homework as possible and ask a lot of questions. And maybe even pay to get a condo questionnaire done in advance of making an offer.What if you “have” to waive all contingencies?In San Francisco a realtor told me that you cannot have any contingencies if you want your offer accepted. None at all. So what is a condo buyer to do? If you are going to waive your financing contingency, you better know the condo is warrantable. The buyer agent my buyers worked with was amazing, and did a lot of research on each condo the buyers looked at before making an offer. We basically underwrote and warranted each condo before they even wrote an offer. It’s possible to do and maybe that is what each buyer needs to do on condos to avoid wasting time and money? It would be nice if listing agents did this leg work each time so the pool of buyers knew if there were problems.Focused on saving money? Do the advance homework through your realtor or lender on a condo before writing an offer. Then fees paid during a home buying process may be saved.Contact me to discuss a condo, mortgage rates, or other mortgage questions. Click here to schedule a call. Or you can\u00a0email me\u00a0directly."}