Contract Escape Routes For Home Buyers and Sellers

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Contract Escape Routes

 

Whether you're buying or selling a home, its important to know the phases and contingencies that allow either side to withdraw from the contract.

 

Buyer or Seller Can Cancel Without Penalty

  • In the first five business days of attorney review, either attorney can disapprove the contract for reasons other than price.
  • If asked to approve an extension to the dates in the contract before all contingencies are resolved. 


Seller Can Cancel Without Penalty

  • If the buyer doesn’t fulfill commitments like turning in earnest money or meeting the date to apply for a loan.
  • If not able to find a suitable home to move to (if this was agreed to by the buyer and written to the contract).
  • If unable to demonstrate a clear title to the property.
  • If unable to complete the sale because of the inability to pay off the loan, back taxes or liens.


Buyer Can Cancel Without Penalty

  • If the seller didn’t provide correct information on disclosures. 
  • If during the inspection period the buyers feel that there are too many problems to address, or if the seller doesn’t approve requests for repairs.
  • If the home doesn’t appraise at or above contract price; if the buyer doesn’t want to bring in more money and the seller won’t cover the difference.
  • If they are unable to obtain financing with terms described in the contract.
  • If they have a home sale or home close contingency and the house doesn’t sell and/or close.
  • If homeowner or flood insurance can’t be obtained.
  • If problems with the HOA can’t be resolved.

 

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