We had a sinkhole repaired about 10 years ago. Insurance covered the expense and we are still insured. Problem: we are ready to sell and our buyer just backed out of his offer because he said his bank would not give a loan for a sink hole house. Is that common? What is a seller to do?
Yes this is more and more common unfortunately. Depending on where you are located many banks are requiring sinkhole coverage but it is also those same areas that it is hardest to get coverage in. Homes that have had prior sinkhole issues are even harder to find coverage for. Unfortunately as a seller I am not aware of anything you can do because the issue lies with the buyers lender and you have no relationship with them. My only suggestions would be of course to suggest to your buyer they find a different lender that will not have these stringent standards. There are plenty of banks that will loan on homes with repaired sinkholes, they probably just didn’t find the right one. As far as the insurance issue goes, you could speak to your insurer about carrying the coverage over to the new owners. After all, insurance goes to the house not the individual so many carriers do not have an issue with just transferring the insurance over as long as the new buyer meets their qualifications.