I’m Selling My Home. Can I Back Out of My Contract?
Selling a home is not a decision to be taken lightly. You may have lived in your home for many years or even decades. Your children might have grown up in the home.
You may think you’re ready to leave the familiarity of your home for something newer and more exciting in a different location, but sometimes things change. We may suddenly get cold feet, especially when considering a move out of state or perhaps even in a different country.
But you’re in a contract now. Somebody wants to buy your home, which should be great news, but now you’re having second thoughts. What can you do? Do you have any legal rights? What will be the repercussions?
Can You Back Out of a Contract?
Once your home is under contract to be sold, getting out of it is not an easy or straightforward process. You may not even be able to get out of the contract unless you pay steep penalties.
Generally, the most common ways to get out of a real estate contract involve the buyer not performing. What exactly does this mean? It could refer to anything that the buyer needs to do on their end in order for the home to close, but has failed to do so. Examples include missing a deadline, not being able to secure a mortgage, or not paying a deposit.
If there is any reason that you may not want to sell your home, a seller’s best bet is to have contingencies drawn up in the contract ahead of time. This means that you can make the sale contingent on certain conditions. For example, backing out of a sale is very common for sellers during a hot housing market, when their home sells quickly and they have not yet secured a new home. Or maybe you signed a contract with one buyer but received a much higher offer from another buyer.
In any case, if you are a home seller and have no contingencies in place, you will have to pay penalties for canceling the contract on your end. The seller may be ordered to:
- Return the buyer’s earnest money deposit.
- Pay back any fees the buyer paid for inspections and appraisals.
- Reimburse the listing agent for the lost commission and marketing costs.
- Pay any other reasonable expenses the buyer incurred.
Keep in mind that until there is a contract in place, you have no obligation to any potential buyers. The contract to sell real property must be in writing; it cannot be oral.
Seek Legal Help
Buying or selling a house is an important decision. There may be hundreds of thousands (or even millions) of dollars at stake, so of course you want to make the right move. This can cause one party to have buyer’s (or seller’s) remorse.
Sometimes parties have to back out of a contract. Is it a breach of contract? Will there be penalties? Fort Lauderdale real estate contract lawyer Edward J. Jennings, P.A. can help you understand the downsides of backing out of a contract. Fill out the online form or call 954-764-4330 to schedule a consultation.
Source:
bankrate.com/real-estate/ways-home-sellers-can-back-out-of-contract/
