I got a property under contract using a purchase and sale agreement. I did not sign a closing date on the paperwork and we have not agreed to close. The seller is threatening to sew me if I don’t send in the Hud 1 statement. I told the seller that I would need to go back and renegotiate the price of the property if I was to buy it. The seller does not want to do that so what do I need to do at this point? The seller says that because I signed the purchase and sale agreement that I’m bound to it and cannot back out or change the price.
What kind of contract are you using? is it one from the state, or a custom one you had drafted?
There’s usually multiple clauses within a purchase agreement that allow the buyer to back out, so what kind of contract are you using?
He can sue you for specific performance or damages unless your contract allows you to back out or you don’t have an enforceable contract. I doubt the seller is going to do anything because it will cost him money to sue you before he collects anything.
Next time, get your forms from an attorney or real estate agent. Never use a legal document unless you completely understand it. Internet forms are fine if everything goes well. If you were served with a lawsuit, you would have about 10 days to respond and find an attorney to represent you.
Bill,
I want to ask you what you use that “allows you to back out”. I’m using the standard contract on short sales I’m doing, but I want a clause that allows me to back out if I don’t find a buyer. My money guy won’t finance the A-B deal unless I have a firm B-C deal lined up, so in reality I can’t perform if I don’t have a buyer. How would you indicate that in the contract?
You can say exactly that: no deal unless you have a buyer. However, I would never accept such a term and never recommend someone accept it either, but that doesn’t mean there isn’t someone who would. In your case, I would not make an offer until I already had a buyer lined up.