Are you a home buyer or seller and are thinking of backing out while in escrow?
In this blog post, we’re going to cover part 2 on topic of if a buyer or seller back out while in escrow.
Last week we covered what the buyer’s rights are during the escrow process and we specifically talked about the variety of contingencies that a buyer has which protects their best interests during a Real Estate transaction.
In today’s blog post we’re going to discuss a seller’s rights and if they can back out of escrow when selling their home.
Understanding A Sellers Rights
Technically, a seller doesn’t have the right to cancel unless a buyer doesn’t meet their timeline or defaults on any of their contingencies.
A seller can submit a “notice to perform” to the buyer if they haven’t met their contingencies. This means that the buyer must follow through with their timeline within a certain period of days or they must cancel the contract.
Sellers Must Follow the Law
Although buyers have many contingencies when buying a home, the reality is that a seller cannot just wake up one morning and decide that they are not going to sell their home to a certain buyer because they’ve received a higher offer.
However, the seller can back out of escrow if the buyer hasn’t completed their timeline. Before doing this though it’s best for the seller to consult with their broker or attorney because, it’s possible that the buyer could hold them in breach of contract.
What Is Breach Of Contract?
Breach of contract means that the terms of the contract have been broken and in the case of a Real Estate deal the seller has not abided by the terms of the contract.
Sellers who have found themselves in the position of breach of contract should contact their brokers or Real Estate attorneys immediately because, a court could still order the completion of the sale and it’s possible that the seller may also have to pay additional fees as well.
Contact Fred Sed Realty
Got questions about what to do when backing out of escrow? Are you interested in viewing homes for sale in Southern California? Contact Fred Sed Realty today by calling us at (800) 921-9231 or connect with Fred Sed Realty on Facebook.