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Barrister
Barrister, Lawyer
Category: Real Estate Law
Satisfied Customers: 35281
Experience:  16 years real estate, Realtor. Landlord 26 years
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If a person has second thoughts about completing a house

Customer Question

If a person has second thoughts about completing a house purchase before closure what are the repercussions , do they lose their deposit, are they liable for any costs etc.
Submitted: 8 months ago.
Category: Real Estate Law
Expert:  Barrister replied 8 months ago.

Hello and welcome! My name is ***** ***** I am a licensed attorney who will try my very best to help with your situation or get you to someone who can. There may be a slight delay in my responses as I research statutes or ordinances and type out an answer or reply, but rest assured, I am working on your question.

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Can you tell me what state this is in?

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Has the person signed a written purchase contract for the property and given an earnest money deposit?

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Where is the person in the process? (inspections completed, financing obtained, set for closing?)

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What is the reason for the buyer wanting to back out?

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thanks

Barrister

Customer: replied 8 months ago.
the answers to his questions are1 Arizona 2 yes and yes 3 Inspection just done, financing obtained, closing date August 1 Reason - condo is on 2nd floor and my friend is having problems climbing, financial in that she is TRYING to sell her house and the market here is dead so she cannot afford 2 mortgages also the total amount of money to outlay is also now a problem because she wanted the money from first house to be used to buy 2nd house
Expert:  Barrister replied 8 months ago.

Ok, unfortunately, friend's physical problems with climbing wouldn't give her legal grounds to get out of the contract. If she just breached the contract, then the seller has a few options. First, they could sue for "specific performance" in court to have a judge order the sale to continue under threat of contempt of court and jail time. Second they could sell the house to someone else and then sue for any damages and for any lost money if they had to sell it for less. Third, they could just keep the deposit money and release the buyer from the contract.

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The first two can take thousands in legal fees and take a year so the house is tied up that entire time so are very rarely used.

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So by far, probably 98%, the seller will just keep the deposit and then terminate the contract and move on to a new buyer..

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thanks

Barrister

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