Takesies Backsies
Now that we know what would make a seller back out of a contract, we can explore whether or not they can. In a real estate contract, the favor is usually on your side as the buyer. The contract offers the buyer several ‘outs’ during the contract period. For the seller to take back their home without consequence, it must fall under one of these five situations.
1. Before a contract is officially signed.
A verbal agreement and a handshake are not exhibits that hold up on Judge Judy, or any other court of law. Until that pen meets paper, or mouse clicks to eSign, the seller has the right to change their mind.
2. The contract is in the 5 day attorney review period.
If your contract calls for attorney review, it is sent to a lawyer to review the fine print and ensure that the contract outlines what was intended. During the review period, a proposal can be made for modifications. If the contract does not state what the seller intended, it may be cancelled.
3. If a seller contingency was not met.
Typically we see contingencies added to the contract that protect the buyer. However, the seller may have added a contingency for themselves, for example, that they have to close on a new house before they vacate the one they are selling. This is an example of why it is so crucial for everyone involved in a transaction to read the contract carefully.
4. The buyer does not stand by the contract terms.
Example, if the buyer does not obtain financing during their allocated contingency period, the seller can pull out.
5. The buyer requests repairs that the seller is not willing to take care of.
A buyers agent will help with the negotiation of repair items being countered for after an inspection. Just remember, you can request for all you want but the seller is under no obligation to agree to your terms. They are after all, requests, not demands.
When the ball is in the buyers court
If the reason for the seller backing out of a contract falls outside of the above mentioned areas, the buyer now has the upper hand. You have two options. Force the seller to uphold their end of the deal or bow out gracefully.
If the buyer chooses option two, they don’t have to walk away empty handed. The buyer can require the would-be seller to reimburse them for any expenses they have incurred during this contract, such as:
OR, the buyer goes for option one, because the buyer does not have to let the seller back out of the contract. The buyer can choose the prize behind door number one, a brand new house! The part of the contract that allows the buyer to hold the seller to their deal is called the specific performance provision. Simply put- you signed, we signed. No mercy, tell your story walkin’.
