Everyone has a valid point. It depends rather there was a mortgage contingency clause or not, which means if the buyer failed to secure a mortgage, they can back out and get their deposit back. Usually there is unless it was an "all cash" deal or not mortgage contingency which is why some sellers would rather accept an all cash offer even if it is a bit less to ensure the deal gets closed. It happened to me twice as a buyer when buying my starter home and current home. The mortgage lender denied me the mortgage. Bottom line is how much does the buyer really want it? In both cases for me I really want it so I explained to the seller what had happened and he was willing to lower the price down a bit and pushed the closing date further out giving me time to secure a mortgage with a different lender who eventually approved, so all hope is not lost. The second time, the seller refused to lower the price, so I had to increase my down payment. Essentially the lender was only willing to give me 80% of what they think the value of the house is according to their appraiser, not my offered price. In another word, I offer 100k and expect to put 20% down, common in my area, so expect a 80k mortgage from my lender. However, they feel the house is only worth 90k, so will only lend me 80% of that amount which is 72k. To secure this mortgage, I have to come up with 28k rather than the original 20k that I was expecting to down. Hope this is clear. Too bad it doesn't help you now but maybe other will benefit from my experience. So if there's a will there's a way.