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Buyer Backed Out |
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We our selling our home, and had a closing scheduled for tomorrow morning with the buyer. We signed the agreement, rented a truck, got completely moved out and the buyer decided less than 24 hours before closing that he was going to back out. He is refusing to give us the Hand Money. Is that legal after an agreement is signed? Who is responsible for all of the realtor/legal fees? |
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One of the first questions you need answered is -- how much money do those buyers (okay, non-buyers) really have? Is it going to be worth the legal expense of going after them for your losses, including any loss if you later sell to someone else for less that they were supposed to pay? Does your state, or your sales contract, provide that the loser would pay all the court costs? Is your broker going to try charging a commission? -- many would not.
Have the buyers told you in writing that they will not go through with the deal? Does your contract give them any legal standing for backing out? And again, is it worth suing them--if you did get a judgment, do they have the money to pay it?
Given the slow real estate market these days, by the way, it may be worth trying to re-negotiate with that buyer, however unpleasant. May save you trouble in the long run.
The Hand Money you mention should be held by a broker, lawyer or title company (I forget what state you're in and what your local customs are) but whoever holds an earnest money deposit in escrow is not allowed to release it without written agreement of both parties, or a court order.
In any event, what you need right now is a conference with a real estate lawyer, who can look over all your papers and advise you.
Let me know what happens; I'm interested.
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Edith
Originally published on January 17, 2008 |
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