Quote:
Originally Posted by calculoso
As far as I'm aware and it is likely not quite this simple, but if there is a firm sale on your house (ie: conditions removed) and the buyer walks away from it, you still get the deposit. I also believe the deposit is usually at least 5% ($50k on $1MM), which should more than cover any debts until the next sale.
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Not quite how it works.
1)You don't just get the deposit. When a buyer defaults, the seller still have to go through a legal process and essentially sue to get the deposit.
Considering it's a foreign buyer who is backing out, that will be very difficult to do.
2)Using the same numbers as an example and assuming they successfully sue for the 5% deposit:
That local home seller gets $50,000 from the defaulted deposit; but they now have the completing of their $1.5M purchase come up and haven't sold their current home.
They have no way of completing that sale and will have to default on their 5% deposits which is $75,000.
Net result is a $25,000 loss and lots of headache for that local home owner. All of that is assuming they can even successfully get the defaulted deposit released to them and not factoring in legal costs.