Can gap closing occur naturally or does it require intervention?

What is a Gap Closing in Real Estate?

Real estate transactions can be complicated, and one term that you may come across is “gap closing.” This term refers to the process of finalizing a real estate deal by bridging the gap between the purchase price and the amount of money that the buyer has available.

How Does Gap Closing Work?

When a buyer makes an offer on a property, they typically provide a deposit to show their commitment to the purchase. However, this deposit is usually only a small percentage of the total purchase price. The buyer will then need to secure financing for the remaining amount.

If the buyer is unable to secure financing for the full amount, they may need to negotiate with the seller to bridge the gap between their available funds and the purchase price. This negotiation can involve a variety of options, such as increasing the down payment, extending the payment schedule, or reducing the purchase price.


  • What happens if the buyer cannot bridge the gap?
  • If the buyer is unable to bridge the gap, they may be forced to back out of the deal. In this case, the seller may keep the deposit as compensation for any damages or expenses incurred during the transaction.

  • Can gap closing be avoided?
  • In some cases, buyers may be able to avoid gap closing by securing pre-approved financing before making an offer on a property. This can help them determine their budget and avoid making offers on properties that are outside of their price range.

  • Is gap closing legal?
  • Yes, gap closing is a legal practice in real estate transactions. However, it is important for both parties to fully understand the terms of the agreement and seek legal advice if necessary.


Gap closing is an important part of real estate transactions that allows buyers and sellers to negotiate and finalize deals. While it can be a complicated process, understanding how it works can help ensure a smooth and successful transaction.