There is a widespread belief that a buyer who cannot complete loses their deposit and walks away. Losing the deposit is where the exposure starts rather than where it ends, and understanding that is the best argument for taking your subject period seriously.
When the contract becomes firm
Your subject conditions are the protection. Removing them ends it.
Once subjects are removed, or on acceptance if you wrote a subject-free offer, you have a firm contract and an obligation to complete. Our subject removal guide covers what each condition does while it is live.
Buyers sometimes treat subject removal as a formality in the middle of a process. It is the moment the risk transfers, and it deserves a pause rather than a signature on the way past.
What a breach can cost
If you cannot complete, the seller may pursue remedies.
The deposit is generally the first thing at stake. Beyond that, if the seller resells the property for less than your contract price, the difference and associated costs can be claimed. Nobody can tell you that number in advance, because it depends on what the property fetches later and what the seller incurs in the meantime.
That uncertainty is the point. Our earnest money guide covers where the deposit sits and what governs it, and our deposit versus down payment guide covers the distinction buyers confuse most often.
If you are in this situation, it is a lawyer's question immediately rather than an agent's question.
The rescission period does not help here
BC's Home Buyer Rescission Period Regulation gives a residential buyer three business days from acceptance to rescind, with a fee of 0.25% of the purchase price.
That window closes within days of acceptance, long before completion. Our rescission guide covers how the days are counted and what is excluded, including presales.
So by closing day the rescission right is long gone. It is not a safety net for a failed completion.
What actually causes this
Three things, in our experience, and all three are visible earlier if someone is looking.
Financing that did not land as assumed. A pre-approval is not an approval, and the lender's final word depends on the specific property as well as on you. Our pre-qualification guide covers the even earlier stage that gets mistaken for more than it is.
Funds that were not liquid on the date required. Money in an investment account, a gift that has not arrived, or an RRSP withdrawal that takes longer than expected. Our down payment gift letter guide and Home Buyers' Plan guide cover the timing traps in both.
A low appraisal. If the property appraises below your price, the lender may advance less than you expected and you cover the shortfall in cash. Our appraisal gap guide covers how that plays out.
Why competitive pressure is where this starts
The advice to remove a financing condition in order to win a bidding contest is where a lot of this begins.
It does strengthen an offer, which is why it gets suggested. It also transfers real risk to you, and the risk is precisely the gap between a pre-approval and an approval. Our multiple offers guide covers the competitive situation, and our competitive offer guide covers the levers that do not require taking this on.
Some buyers can genuinely carry that risk. Many cannot. The mistake is deciding which one you are in the room, on a deadline, with a house you have fallen for in front of you.
If you think you might not complete
Call your lawyer and your mortgage broker immediately. Not on completion day.
Early notice gives everyone more options. A seller can agree to amend the contract, including extending the completion date, and some will, particularly if they prefer completing late to litigating. They are not obliged to, and they may have their own purchase depending on receiving your funds on time. Our closing day guide covers how interlocking those dates are.
A holdback or an amendment negotiated a week out is a different conversation from a phone call at 2pm on completion day.
How to avoid it
Use real subject conditions and give them enough time. Our closing timeline guide covers how long each step actually takes, and specialist inspections take longer to book than people plan for.
Confirm your funds are liquid on the dates required, in writing, with your broker and your lawyer. Then remove subjects when you are satisfied rather than when the calendar says to.
In our experience buyers who get into this position are rarely reckless. They are usually people who accepted a tight timeline to be competitive and had one thing go differently than expected. The protection against that is time and verification, both of which are available before you write.
We are agents rather than lawyers, and none of this is legal advice. If completion is at risk, speak to your lawyer or notary immediately.
Key takeaways
- Removing subjects makes the contract firm and transfers the risk to you.
- The deposit is the starting point of exposure, not a cap on it.
- The three-day rescission period closes long before completion and costs 0.25% of the price.
- Most failed completions trace to financing, illiquid funds, or a low appraisal, all visible earlier.
- If completion is at risk, call your lawyer and broker immediately rather than on the day.
Frequently Asked Questions
What happens if I cannot complete on closing day?
Failing to complete a firm contract is a breach, and the seller may pursue remedies beyond keeping your deposit. If the seller resells the property for less than your contract price, the difference and associated costs can be claimed against you. That exposure is real and uncapped, which is why we treat a completion date as fixed rather than flexible. If you think completion is at risk, call your lawyer immediately rather than waiting for the day itself, since early notice gives everyone more room to negotiate an extension or amendment.
Do I just lose my deposit?
Losing the deposit is the starting point of your exposure, not the ceiling. Once a contract is firm and you fail to complete, the seller may pursue further remedies. If the seller resells the property for less than your agreed price, the difference plus associated costs can be claimed from you. That amount depends on what the property fetches later and what the seller spends getting there, so nobody can tell you the number in advance. Treat the deposit as the floor of your risk, not the total, and speak to a lawyer immediately if completion is in doubt.
When does a contract become firm?
A BC purchase contract becomes firm the moment your subject conditions are removed, or immediately on acceptance if you wrote a subject-free offer. Before that point, your subject conditions are the protection that lets you walk away. Once they are gone, the obligation to complete is real, and failing to do so is a breach that can expose you to more than your deposit. Treat subject removal as the moment the risk transfers to you, not as a formality to sign on the way past.
Is the rescission period a way out?
No. BC's Home Buyer Rescission Period gives a residential buyer three business days from acceptance to back out, at a cost of 0.25% of the purchase price. That window closes within days of accepting an offer, long before your completion date arrives. By the time closing day is a concern, the rescission right is already gone, so it offers no protection against a failed completion. The real protection is a firm contract you can actually fulfill, backed by verified financing and liquid funds before you remove subjects.
What usually causes a failed completion?
In our experience, three things account for most failed completions. Financing that did not land the way the buyer assumed, since a pre-approval is not an approval and the lender's final word can come later than expected. A down payment or deposit that was not liquid on the date required, often money tied up in an investment account or a gift that had not arrived. And a low appraisal, where the property values below the contract price and the lender advances less than planned. All three are usually visible earlier if someone is looking for them.
Why is removing the financing condition risky?
Removing your financing condition commits you to complete the purchase before your lender has given final approval. A pre-approval is not an approval, and the gap between the two is exactly the risk you take on when you drop the condition to strengthen an offer in a competitive situation. If the lender's final word does not come through as expected, or a low appraisal leaves a shortfall, you are still obligated to complete. Some buyers can genuinely absorb that risk, but many cannot, and deciding which one you are under deadline pressure is the hard part.
Can a low appraisal cause this?
Yes, a low appraisal is one of the more common causes of a failed completion. If the property appraises below the contract price, your lender may advance less than you expected, and you have to cover the shortfall in cash on completion day. If you do not have that cash, the purchase can fail even with your financing otherwise in order. Deal with the appraisal question inside your subject period, before the contract becomes firm.
What should I do if I think I might not complete?
Call your lawyer and your mortgage broker immediately, not on completion day itself. Early notice gives everyone involved more options, including the chance to negotiate an extension or an amendment with the seller before the contract is breached. A seller can agree to amend the contract, and some will, particularly if they prefer completing late to pursuing litigation, though they are under no obligation to agree. A holdback or an amendment negotiated a week out is a far better position than a phone call on the afternoon completion is due.
Can the seller agree to an extension?
Yes, a seller can agree to amend the contract, including extending the completion date, and some will, particularly if they prefer completing late to going to court over a breach. The seller can also refuse, and they may have their own purchase depending on receiving your funds on the original date. Give notice as early as you can: a seller approached a week before completion has more room to say yes than one who finds out the morning funds are due.
How do I avoid this entirely?
Use real subject conditions and give them enough time, since specialist inspections and lender sign-off often take longer to book than buyers plan for. Confirm your funds are liquid on the dates required, in writing, with your broker and your lawyer, before you remove subjects. Do not drop a financing condition to win a bidding contest without understanding that the gap between a pre-approval and an approval becomes your risk. In our experience, buyers who reach a failed completion are rarely reckless. They usually accepted a tight timeline and had one thing go differently than expected.
Sources
Verified September 12, 2026. General information only, not legal advice. If your completion is at risk, consult your lawyer or notary immediately.
Related FRIVE guides
- Subject removal, the moment the risk transfers
- Pre-approval vs approval, the gap that causes most failures
- Appraisal gaps, when value comes in below price
- Multiple offers, where the pressure starts
- Earnest money deposits, what governs the deposit
Next Steps: Work with FRIVE
The best protection against a failed completion is a subject period with enough time in it and funds you have confirmed are available on the dates required.
Start a conversation with the FRIVE team and we will build a realistic timeline with you, or browse current Fraser Valley listings.
Sources
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