When a seller has to cancel their contract for non-legal reasons, here are some of the situations they may face. Read on to learn more.
- When the seller does not have the law on their side and does not want to go to court, they may have to enter into “specific performance” that means if they fight, there will be a prolonged legal process. Should the buyer prosper, the seller is legally obliged to sell the property to the buyer.
- The buyer may sue the seller and insist on financial compensation and the payment of legal fees.
- The buyer may place a lien on the property so as to stake their claim on the property and make reselling to others virtually impossible.
- The listing agent can sue the seller as well as for the signing agreement. The seller may end up responsible for the commission that was promised even if the sale is not completed.
- In certain states you will have to attend mediation if the contract cannot be mutually terminated. This is a drawn out process but may save on additional legal fees.
- Because of buyer contingencies, they will have the option of walking away without loss of their earnest money.
- Because of inspection contingencies, if the buyer discovers something during this process and amends cannot be made, they can walk away with no penalties.
- Because of appraisal contingencies, if the value comes in low and negotiations become impossible, the buyer may back away from the contract.
- Because of financing contingencies, the buyer is protected if they cannot obtain financing for any reason.
Craig Cherney is a trusted client advisor and a sought after real estate lawyer and expert witness who is hired by the nation’s top Real Estate Litigation Attorneys to help resolve their litigated real property matters. Craig has appeared as a testifying expert witness before judges and juries in California, Arizona, Nevada and other jurisdictions across the country. Craig Cherney, Esq. Expert Witness Real Estate. 480-399-2342. If you are litigating an easement case, Craig Cherney might be able to help you advance and win your case.