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I am under contract to purchase a condo since the middle of September, and a closing date of 10 Oct.
The seller wants to pull out, which is technically a breach of contract. Is there any recourse as a buyer other than trying to sue? Given my particular situation, it just doesn't seem worth it. I already closed on my last home in a different state and am kind of in limbo right now until I close (or am unable to close and get stuck).
If you've dealt with this, what was your experience?
Is there any recourse as a buyer other than trying to sue? Given my particular situation, it just doesn't seem worth it.
Yeah, the resulting lawsuit will take a lot of time and money and is something probably no one involved will feel good about when it's over.
However, there are options for you. In addition to your EMD, which you should get back, your agent (or attorney) may be able to negotiate for the seller to reimburse you for your other losses as a result of this breach. The sellers should pay for your inspection, appraisal fees, and other direct costs... And I would push for reimbursement of living expenses and other costs that are a result of the delay you will now face while you search for a replacement home.
The agents involved may also be able to recover commissions.
We have had this happen before, and we were able to get costs and extra living expenses paid for our buyers, voluntarily, through a cancellation agreement.
See an attorney if you want to fully explore ALL your options. Much depends on your contract, where you were in the process, and how badly the sellers want to cancel.
I am under contract to purchase a condo since the middle of September, and a closing date of 10 Oct.
The seller wants to pull out, which is technically a breach of contract. Is there any recourse as a buyer other than trying to sue? Given my particular situation, it just doesn't seem worth it. I already closed on my last home in a different state and am kind of in limbo right now until I close (or am unable to close and get stuck).
If you've dealt with this, what was your experience?
I've had a seller decide at the last moment (as in, when he was supposed to be at the closing table) that he wasn't satisfied with the deal and wasn't going to sell (it was a cultural thing - in his culture, negotiations went on up to and past the end of a deal, and he didn't get that that's not how it works here). Took me explaining carefully to his agent, and then my broker doing the same thing, what the potential consequences were to him per the contract. We did close that day, but it was very stressful. But sometimes letting them know that you WILL follow through with legal action to enforce your contractual rights works; other times, as Diana described, you can get compensated, if not the home.
it depends on the language of your contract, in the state you're trying to buy. Your agent and whatever legal entity already represent you is the place to start. If it's a state with no closing attorneys or legal representation, then you want to hire a qualified attorney
OP, do you know why the seller has cold feet? I would start there.
We once had a seller who was going into a retirement community. She threw every possible hurdle at us because she really didn't want to sell. She started hyperventilating at the settlement table and went as far as faking a heart attack with EMTs called to delay closing. Not kidding (they released her from the ER several hours later with a clean bill of health.) Our agent and our attorney finally spoke truth to her and her agent who happened to be a friend of hers. She could not afford NOT to sell but was kicking and screaming every step of the way.
If your seller is just having an emotional reaction to selling, financial realities might bring them back to earth. If their life circumstances have changed you may or may not have any leverage. But that is the thing I would want to know first and foremost.
I think you've gotten good advice. I just want to throw in the option (last resort) of a lawsuit for specific performance. It can take weeks/months to years; and it is expensive. Sometimes the thought of being tied up in a lawsuit which they are most likely going to lose will be sufficient to get the contract fulfilled. I think most sellers do not believe they can be forced to sell - but they can be. In the meantime, their property is tied up and they cannot sell to anyone else.
For me, I might threaten but I'd never go through with it. I worked as a paralegal during a particularly drawn out, lengthy lawsuit over vacant land. In the end, the court ordered the seller to sign and when he didn't, he was jailed. It was commercial property and turned out to be extremely profitable for the buyer so it was very much worth his time and expense but not so for a house that isn't in the way of a planned highway.
OP, do you know why the seller has cold feet? I would start there.
We once had a seller who was going into a retirement community. She threw every possible hurdle at us because she really didn't want to sell. She started hyperventilating at the settlement table and went as far as faking a heart attack with EMTs called to delay closing. Not kidding (they released her from the ER several hours later with a clean bill of health.) Our agent and our attorney finally spoke truth to her and her agent who happened to be a friend of hers. She could not afford NOT to sell but was kicking and screaming every step of the way.
If your seller is just having an emotional reaction to selling, financial realities might bring them back to earth. If their life circumstances have changed you may or may not have any leverage. But that is the thing I would want to know first and foremost.
As far as I know, this breach of contract wasn't due to cold feet. It was due to bad math and bad communication with the person's listing agent. The person had the place listed on the market too high months ago and had to keep lowering the price. Eventually the price was low enough for someone (me) to make an offer at asking. Unfortunately, that asking and agreed-to price wouldn't allow the person to pay off a significant amount of $ they would still owe on their mortgage balance. That person even tried to get personal loans to make up the difference and kept getting denied the loan.
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