In the mortgage pipeline, borrower fallout reflects the risk that prospective borrowers may choose to walk away, falling out or withdrawing from the contract. This risk particularly arises after borrowers have committed to close their respective loans, but elect not to proceed.

In mortgages, the risk that a potential borrower (i.e., a property buyer) will pull out of the contract (mortgage deal) before it is finalized. A mortgage fallout constitutes the percentage of loans in a mortgage originator‘s pipeline that fails to close.

Borrower fallout is part of fallout risk.