Buyer backed out of closing 7 days before closing date.

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Buyer backed out of closing 7 days before closing date.

We had our home listed with a local agent, and a buyer toured our home and made 2 or 3 offers to which we declined. We decided to remove our listing and stay. Two weeks after canceling our listing, the buyer approached us again with an offer we accepted.

We just finished litigation with a roofing company that installed our new roof incorrectly, during the process of the buyers looking and making offers while home was listed for sale, buyer knew of roofing issues and that we were scheduling a new installation. They still made and offer, and accepted the condition of the property. The home passed inspection, and the buyer texted us and said she was continuing with the closing set for this coming Friday 10/4/2019. Seven days prior, last Friday she canceled the contract. Do we not still have a contract? Can she legally back out?

Asked on September 29, 2019 under Real Estate Law, Arkansas

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

If there was a contingency clause in the contract allowing for this (e.g an inspection contingency), then she can cancel the closing if she is still allowed at this late date. Otherwise, she cannot cancel and if she deos so, you are entitled to keep her earnest money (i.e. deposit).

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

She can only back out legally if there was some clause or contingency in the contract allowing her to back at that time time and for the asserted reason. If there was no such clause or contingency, she remains contractually obligated and if she does not close, you will be legally allowed to retain her deposit or earnest money.


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