BUYING A HOME? CLOSE THE DEAL AS QUICKLY AS YOU CANJul 11 2016
In today’s red hot real estate market, some interesting scenarios are playing out between buyers and sellers. Sellers are backing out of their agreements in order to gain more money from the sale of their homes. Not only does this leave buyers in a bind but, more importantly, there are significant legal ramifications.
Most scenarios look like this: sellers enter into sale and purchase contracts with buyers where there is a longer completion period. During the time it takes to actually meet all the conditions and finish the sale, it’s not uncommon for the price of real estate and the value of contracted property to increase significantly. Unscrupulous sellers, believing they may be missing out on increased financial gains, are looking for any excuse to get out of an existing contract and so they’ll avoid closing the deal. What these sellers may not realize is that when they do so, they are breaching a legal and binding contract.
What does this mean for buyers? Many buyers are often not aware of their legal rights and are usually desperate to find alternate property options. Most of them will move on and let breaching sellers off the hook. In the current real estate market, that could be a costly mistake because the differences in market values over the course of even a couple of months can be substantial.
There are legal options available. For example, buyers with a binding agreement may seek a remedy through court to compel the sale through. Alternately, they may also choose to accept the seller’s breach and sue for damages, which can include the difference between market value for a similar property and the purchase price set out in the agreement. And, even in the event that buyers do find a new property to purchase, they should still consider maintaining a claim against the sellers for the missed opportunity of purchasing a home at a lower price.
What can you do? If you’re a buyer and you get a good price on the property you’ve purchased, it’s recommended that you take all steps necessary to firm up and complete the deal as quickly as possible. Make sure subjects are moved on the agreement and that deposits are paid on time so you can ensure the deal goes through with the seller.
If, however, you find yourself in a situation similar to what’s been outlined above, be aware that an illegal act has taken place and that you do have options. Consider talking to a qualified legal advisor to discuss what might be the best course of action for you.