The buyer asked the buyer's agent to hold the deposit check and not to deliver it to the seller's agent. The contract went in effect today and the buyer wants to back out today. Can he do that for no reason?
Real Estate Attorney
You have asked this question in a public forum. As a result, your buyer may be able to read this answer and be guided by it.
When a buyer simply says "I want out" and does not deliver the deposit, the issue becomes: Is this a buyer default? The buyer can argue there is no consideration for the contract, and in some courts might win. You would argue that since consideration is not needed for a deed, why should it be important for an agreement of sale, since an agreement of sale conveys equitable title to the property. The buyer would counter that the agreement limited liability to the deposits paid. Are you starting to smell a "lawyer's full employment opportunity"??
There are three far more reliable exit routes for a buyer: 1) if the property is in a condominium or subject to a homeowners association, one may cancel within 5 days after receipt of the certificate from the association. 2) the property inspection clause of the agreement of sale usually allows the buyer to cancel after inspections. Nothing defines the scope of inspections. A "drive by," followed by a bad feeling may be enough. Finally, 3) the failure to receive a mortgage commitment is a basis for cancellation. This only works if the buyer honestly tries to get the mortgage. There certainly are other ways to cancel, but as you can see any one of these three is better than the one your buyer is using.
Now let's get to the practical. Your buyer has cold feet. Making a claim of default is not going to warm the feet up. In fact, it will make things worse as the buyers defensively retreat into their corner. The greatest tool in sales is fear of loss. Or, as is said in the department of redundancy department, the greatest tool in sales is fear of loss. Tell the buyers they have missed their opportunity to buy your HOME, and that some other family will be getting that opportunity soon.
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