Searching for the perfect home can be exhilarating. Buying a home is one of the biggest investment decisions of your life, as these beautiful pieces of property do not come cheap. So, you found a great house and you made an offer on it. Unfortunately, you later find out the not-so-perfect details about the house. With the offer made, are you stuck with it? It depends. Read on to learn when you can and cannot back out of buying a house after an offer has been made.
Offers and Counteroffers
Once you found a house that you truly love, you made an offer. It's the obvious step, but it is important to know that the offer is not a binding contract until the seller accepts your offer. Therefore, your offer can be retracted at any given time up to that point. The same is true when the seller makes a counteroffer to you. Until that counteroffer is accepted by you, there is no binding contract in place. Acceptance is key when it comes to offers and counteroffers in real estate.
Contingencies
If the seller has accepted your offer and the contract has been signed by all involved parties, you may think there is no legal way out. However, there are a couple of avenues that may still allow you to back out of your purchase. These are called contingencies, which are conditions that must be fully met prior to the closing of a real estate deal. Some of the most common contingencies are as follows:
- Inspection – This contingency provides you, the buyer, with the right to fully inspect the home for structural damage, termites, etc. prior to closing on the home. If any issues crop up during the inspection, depending on the exact terms of the agreement, you can back out of your contract or demand that repairs be made prior to closing.
- Financing – If a problem arises with the financing of the home, you can get out of your offer. However, you must diligently try to get the loan within a certain period of time or this contingency does not apply.
- Title – This contingency requires that the seller prove that the home is owned by them and that they are permitted to sell it legally. If this cannot be proven, you can cancel your offer and the contract.
Breach of Contract
Your last option, and an option that is not recommended under most circumstances, is to breach the contract. If a contract is broken, it will likely cost you a pretty penny. Most contracts have a clause that requires you to pay a certain amount to the seller if you break the contract. Plus, any deposit that you paid will be lost.
For more information, contact Loughlin Fitzgerald P C or a similar legal professional.
