Can we walk away from a real estate contract if the home is in foreclosure?

Asked on December 4, 2011 under Real Estate Law, New Mexico

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Good question. Is the purchase of the home that you are in contract to purchase subject to the seller's lender's approval of your contract by a short sale addendum and the approval has not happened yet? If so, you can cancel your purchase contract most likely.

If you have not waived and contingencies to purchase the home such as home inspection or loan contingency, most likely you can cancel the purchase contract.

If the property went into foreclosure after you went into contract then you can cancel the contract since the foreclosure jeapordizes the purchase. I suggest that you consult with a real estate attorney further on your question.


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