My name is***** and I will be helping you with your question today. This is for informational purposes only and does not establish an attorney client relationship.
A real estate purchase contract is legal and binding. Once both parties sign the agreement, they're expected to abide by its terms. As such, backing out of a contract can often be an expensive proposition. However, most contracts also have clauses that allow either party to walk away from the transaction with no penalty if certain conditions are met.
Each contract will have responsibilities of the seller and the buyer. If one party does not perform there are cure periods. If the cure is not met there are options to withdraw. Read your contact closely and get the advice of an Arizona attorney to read the entire agreement to see if you can get out of the deal. Note, examples are the seller disclosure and the buyer inspection period. If the inspection reveals items that were not properly disclosed or faults in the home that are material and cannot be satisfied by the seller this may be a reason to withdraw.
Other contract contingencies may involve the buyer's ability to secure financing. Depending how the contract is written, this may be an exit point. For example, if the bank will not appraise the home at an amount to collateralize the loan properly, the buyer's ability to complete the transaction would be in jeopardy.
There are others too, Read the contract and seek advice from the professionals around you from your Realtor to attorney, to inspector and the lender.
You can lose your earnest money and also be sued for "Specific Performance" for not closing. Most sellers will not sue but there is a chance that they could. You signed a contract to purchase a house and you will not back out of a contract without a good reason and consequences.
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