We entered into an contract to purchase a house

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We entered into an contract to purchase a house

Timelines were tight. Contract date 6/9-17. The only document that protects the buyer is the inspection which had to be completed in 10 days. The inspection could not be done until 6-26-17. All parties were informed via email and inspection was scheduled. Verbally sellers were fine with this. They let the inspectors in and inspection was done and completed. Is this consent? Now that the report is showing structural and water damage issues…we have been advised by dual closing agent representing both seller and buyer if buyer cancels then earnest money goes to the sellers. Is this correct? Seller has not been forth coming and lies a lot. Do we have a case if we pursue this in court?

Asked on June 30, 2017 under Real Estate Law, Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

A written contract cannot be modified by oral (that's the better term than "verbal") consent or agreement--to amend or modify a written contract, the amendment or modification must be in writing,too. Therefore, unless you received written consent to the delay in the inspection, you would have violated the inspection contingency by not getting it done in time; in that case, you cannot use the results of the inspection to legally cancel the contract without penalty, regardless of what the inspection found. Rather, since you would have been unable to use the inspection contingency, if you don't go through with the transaction (i.e. buy the house), you will be in breach of contract. At a minimum, the seller will be able to keep your earnest money or deposit; depending on what the contract says, the seller *may* be able to further sue you for additional amounts if their costs or losses from your breach (e.g. their "carrying costs," such as mortgage, taxes, utilities, and insurance, if they have to hold onto the house for many months more before being able to sell it) exceed the amount of the earnest money.


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