Are you all tied up in a purchase contract that is a mistake? What can you do?
First of all, it is always better to protect yourself in your Real Estate offer with contingencies than to try to untie yourself from a contract after you are knotted up to with no escape route…not that I think you should go to contract if you have reservations. If in doubt, do not sign.
But here are some strategies for cancelling a contract that you could use:
Contract contingencies are simply a way a buyer can back out of a contract within a set period of time if certain conditions specified are not met in a timely manner.
Home Inspections: Make the contract subject to approval of your house inspections and do not box yourself into a tight time frame…give yourself at least 15 days to inspect for anything and everything you want. If unsatisfactory to you, you may have the option to void the real estate contract as long as you are within the time frame indicated.
Mortgage Financing: If you do not qualify for a mortgage under the terms specified under the contract, you may be able to cancel the contract, but expect to provide proof. You should not need to seek alternate financing.
Appraisal: Even if you are paying cash, make the contract subject to the appraised value being equal to or more than the purchase price. Do the appraisal after the home inspection and after you have your financing scrutinized.
Attorney Review: Make the contract contingent on your attorneys approval. If your are stuck, discuss with your attorney.
More Escapes: Last but not least, did the seller perform in a timely manner per the contract? Did everyone sign and initial all the changes? Does the title have clouds? Were there non-disclosed HOA capital contributions? Are there encroachments on the property? Did the seller hide some defects? These are all issues that could allow a buyer to cancel the contract.
No one can force a buyer to close on a property, but depending upon how the real estate contract was written and the buyers performance, the seller may be entitled to keep your deposit. If you are serious about voiding a contract, it is always advisable to seek a legal opinion from a real estate attorney.
Copyright @ Buyers Broker of Florida 2011 “How to Cancel a Real Estate Contract”