If I planned on purchasing a home but changed my mind before any commitment letters were drawn and the seller is suong me, what are my rights?

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If I planned on purchasing a home but changed my mind before any commitment letters were drawn and the seller is suong me, what are my rights?

Can they sue for 3 times the purchase price?

Asked on August 21, 2012 under Real Estate Law, New York

Answers:

Mark Siegel / Law Office of Mark A. Siegel

Answered 8 years ago | Contributor

If you signed a contract of sale for the purchase of real estate, then the terms of the contract would define what your rights & obligations are in the event of a default by you, as purchaser. If you made a down payment to the seller's attorney upon the signing of the contract, the contract will define the conditions & circumstances under which the purchaser's down payment will be deemed forfeited to the seller. If the contract provides that the forfeiture of the down payment constitutes liquidated damages, then this will generally be the amount of the seller's damages when the purchaser has defaulted under the contract.

A contract clause which provides the seller with a right to seek damages equal to 3 times the purchase price of the property, may be found unconscionable &/or unenforceable by a court, as a matter of law. If you are being sued, you should seriously consider consulting with an attorney who practices in this area of law & having the attorney review the contract & lawsuit. It is possible that one or more deadlines and/or statutes of limitation exist which may be about to expire, and may bar your ability to pursue your action, or your claims and/or defenses, and/or may work to prevent you from proceeding in the future. You should immediately take appropriate legal steps to preserve whatever rights you may have by consulting with counsel.

   


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