Cancelling out of a home purchase

[Nage Waza]

So what happens if someone offers to buy a home and all the conditions are met, the financing is approved by the bank, the contract is signed, then they decide to not want to buy the house?

I have some friends where this is happening. The sold sticker has been on the sign for three days, and now the agents are asking the sellers if they would mind putting their house up for sale again.

[EDBTZ12]

Well if they signed the contract then the house is already theirs so they are SOL.

[Nage Waza]

They are SOL even though they don't get possession for another month? This is good news, the sellers have had some pretty bad luck and selling this house is very important for them.

[Nage Waza]

What can the buyers do to make it a pain? The agent was the same for the seller and the buyer, if that helps. He called and asked if 'it would be possible' to cancel the sale...he mentioned that he figured the answer was a no but his clients requested he ask.

[EDBTZ12]

Originally Posted by Nage Waza

They are SOL even though they don't get possession for another month? This is good news, the sellers have had some pretty bad luck and selling this house is very important for them.

I would think so. If i understood your OP right you said they got approved for financing and they signed the sales agreement so they essentially bought the house and whether or not they took the possesion has nothing to do with it.

Im no lawyer but that's what seems right.

[Winsor_Pilates]

Just say no, they are obligated to the contract unless your friends agree to let them out of it.
Since the agent is double ending, just let him deal with them, it's his issue.

[Russic]

I would think the contract signing is a bit of a deal sealer ... unless there's some important step afterwards that I don't remember. Can't the lawyer who helped with the contracts provide the final answer?

[Nage Waza]

Thanks for all the good points everyone...the home owner is disabled and cannot manage the home anymore. As soon as the sale went through he committed to a condo and can no longer keep the house.

[Bob]

I'm fairly sure I "bought" my house months before I actually took possession. Otherwise, they'd be building the things, people would walk, and they'd be stuck with an empty house.

[troutman]

The seller can keep the deposit and sue for damages.

This is an older version of the standard AREA contract; see clause 9.1:

http://www.serlox.com/Forms/Offer.pdf

If the Seller or the Buyer fails or refuses to complete this Contract according to its terms, then the other party may pursue all available remedies. The Seller's remedies include keeping the Deposits and claiming additional damages. Both the Seller and the Buyer can claim reasonable costs including legal fees and disbursements on a solicitor/client full indemnity basis.

[Ducay]

Ya, thats what the deposit is for. They get to keep that and then have the ability to sue (which I doubt theyd waste their time doing).

Thats what makes offers with larger deposits more attractive, theres less chance of this happening, and if it does, MORE FREE MONEY WOOOO

[DOK]

This is exactly why you get a large deposit. No deposit = no reassurance. It can get hairy, because they are technically obliged to follow through, but 9 x out of 10, the deposit is given up and the house is put back up for sale. Fair warning though, in the papers, half or more of the deposit could go to the agent representing the house, not to the actual home owners.

[mykalberta]

Backing out of a home purchase after you signed the agreement and paid the deposit - real classy.

As what others have said, my realator said she has seen a few backouts and just forego the deposit. Normally the seller just accepts it and tries to resell it and if they get what they would have got from you they normally forget it.

Some she said have gone after them for different fees, lawyer etc. Also if they made arrangements like buying a new home they will sue for lost investment income from the time they would have been paid to when they move into the new house, or if they have to take out a larger loan they have sued for interest costs etc.

[Titan]

Send them to Trout or another real estate lawyer. Have their options explained to them so they can make an educated decision.

[Titan]

Meant to add to be very leery about dealing with the particular real estate agent until a decision is made as he is dealing on both sides.