You made the decision to sell your property and went through the painstaking details and chores of getting it ready. All the necessary repairs have been made and your home staged. The closets have been drastically reduced in their junk load and every nook and cranny of your home is spotless. You went through the anxiety of making a big impression with the open houses and fought through the anger and disappointment of lowball offers, eventually accepting an acceptable offer.
Then, something happens you did not expect. Coming out of nowhere, it makes selling your home impossible to go through with and now, you’re seriously considering backing out of the contract. However, you know that it’s a binding legal document and you feel a commitment to going through with it for the sake of the buyer but your deference has its limits.
Looking at Your Situation and Options
Of course, there are legal outs, provided in the contract, but there are other ways to get out of a purchase agreement. Those other options aren’t necessarily inexpensive or particularly appealing. You first have to look closely at your situation, then start to evaluate and weigh your options. That’s not going to be easy, because you have to put emotion aside to keep yourself from facing a lawsuit.
“Sellers sometimes change their minds because they’re unhappy about the sale price or the cost of repairs, have lost a job, decided not to relocate to another state or are involved in a loan modification, short sale or foreclosure. None of those excuses makes canceling a deal easy, however. Sellers who need an out should look first to the contingencies, or conditions, that are part of the sales contract.” —HSH Associates, Financial Publishers
As the nearby quote points out, just because your situation changes, it doesn’t mean you can simply call the buyer’s agent and tell him or her to tear up the purchase contract. Even if the job relocation for a promotion is suddenly withdrawn, it’s not legally sufficient for you to cancel the agreement on your own. The fact there’s another party involved, who might have already sold a home is just one reason that’s a reality.
You can’t rescind for even what seems to you to be a good reason, because that’s not the way it works. Buyers generally have a few days to rescind their purchase offers, but that option isn’t there for sellers. However, there are still options available.
Backing Out of a Buyer’s Purchase Contract
First and foremost, you’ll have to take a moment to go over your contract with the buyer, that much is obvious. Unfortunately what you’re unlikely to discover is any direct out. That being said, there is probably terms which you can use to your advantage and other ways out. Here’s what you can do to back out of a real estate contract:
- Buy your way out of the agreement. You can actually buy your way out of the contract, though it won’t come cheap. Through your agent, contact the buyer’s agent and offer to refund the earnest money, and reimburse the buyer for their various expenses, such as the home inspection and other expenses incurred to bring the deal to this point.
- Use the estate sale language. If this is an estate and you’re not the only beneficiary, that’s another way out of the contract. Should the other beneficiaries not agree to the purchase price, then that’s a legal out which can be used to void the sales agreement.
- Refuse to pay for repairs. If there are repairs requested by the buyer and are more expensive than what’s reasonable, then you might have an escape. In addition, if you don’t agree to make the repairs in the first place, the buyer might be motivated to walk away.
- Try to appeal to the buyer. Should you be in a situation like you lost your job or a relocation is no longer viable, try to appeal to the buyer on a personal level and explain your problems.
- Get a real estate attorney involved. It might come down to retaining the services of a real estate attorney to advise you on how to proceed.
As you can see, there’s no easy way out, though it can be done. It might be costly and difficult, and, it can be more time and effort that it’s actually worth. You should seriously consider following through with the deal to save yourself time, grief, money, and stress and move on to a new future.