You may assume that pulling out of a real estate sale or purchase is virtually impossible to do. There are circumstances, though, in which either a buyer or seller may pull out of the contract, each with their own respective penalties for doing so.
Buyers can generally terminate a purchase agreement on a home if contingencies listed in the contract are not met. As an example, a contract may state that the home must successfully pass both a pest and home inspection for the agreement to go through. Another condition may require the buyer to be able to procure financing for the home or for the seller to have fully disclosed all known problems the home has.
Even in cases in which all contingencies are met, a buyer can even still pull out of a home purchase contract. If he or she does, they automatically forfeit any buyer’s fees or earnest money deposits that have been previously put up.
Buyers may also pull out of a contract to purchase a home without being penalized. One of the more common reasons this may occur is if during a final walk through it’s determined that the home is in materially different condition than they agreed to buy. It’s also possible for a buyer to walk away from home purchase if the seller is unable to provide them with a “clean” title to the home.
In the case of the seller, available options for them to pull out of a purchase agreement are far less than those available to buyers. If the home is found to have flaws during an inspection, then the seller may be asked to fix them before they take ownership of the property. If the seller is unwilling to foot the bill for the necessary repairs, then the contract could be terminated by them on those grounds.
If you wish to terminate a home purchase agreement and you want to understand the penalties for doing so, then a Florida real estate litigation attorney can provide guidance to you in your legal matter.
Source: SF Gate, “Can a purchase agreement on real estate be terminated?,” accessed Nov. 01, 2017
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