You could have your agent speak to the sellers agent, If it can't be solved, you should be entitled to be get all your expenses back.
When a seller refuses to close, several things may be happening. One is that he/she got a better offer and prefers it (for any number of reasons) to yours. Another is "seller's remorse," a sort of "insanity" that a few sellers go through right before they are due to leave their home (same thing happens to some buyers). Or it may be a sort of hardball negotiating ploy wherein the seller expects to avoid repairs to which he/she has agreed.
Most agreed-upon repairs are not a condition of closing, and if the seller agrees to do them and then fails to do so, the buyer can close and then have a legal action against the seller. But you don't want a legal action, you want a home.
As it happens, termite work is a higher-level repair than most others, assuming the seller did indeed agree to do Section 1 work on form WPA. If so, the seller owes you a termite completion report, before provision of which he/she hasn't performed on the terms of the contract.
So one question is, what's the extent and cost of that work, can it be accomplished less expensively (e.g., having a handyman perform the wood repairs and the termite company certify them), and are you willing to lose the home over it? South Redondo is a beautiful place to live, and if the cost is minor and you're happy with the home otherwise, then it may not pay to stand on principal. If you negotiated the price down considerably already, then perhaps the seller feels he/she has come far enough already, and maybe you can live with it. In ths case, you would probably want to agree to reimburse the seller for the cost of the Section 1 repairs in escrow (don't pay for anything before you own the home!).
An intermediate strategy might be to agree to split the cost of the Section 1 work in escrow.
Why not just agree to skip the Section 1 work and live with the termites, when the vast majority of homes in the South Bay have termites anyway? You can do this if your lender will allow, but many will not, so that may not be an option.
What if the seller is just using the termite work as a foil for having changed his/her mind on selling the home? Well, there are costs to getting out of a real estate contract, and the seller should be reminded of those. Check the damages clauses. How about the escrow costs? If you had wanted to cancel the transaction (after releasing your contingencies), the seller would have had a possible claim on your deposit. If the seller wants out (and you have kept your end of the deal), then he/she will need your consent to cancel. Perhaps that consent should cost what you would have lost had the situation been reversed?
Your realtor should be speaking with the seller's agent and with your escrow officer to understand exactly where you, the seller, and the transaction stand. With a clear understanding of motivations, an acceptable solution may appear.
Good luck, and I hope that helps!
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South Bay Brokers
Keller Williams Realty
#1 Buyers Agent KW Los Angeles Region
If it can't be solved, you may be entitled to be reimbursed for your expenses...but I always recommend trying to solve the issue first before panicking.