Home Selling in Seattle>Question Details

Su, Both Buyer and Seller in Seattle, WA

After you sign a RE agreement, is there a time frame you have to back out if you change your mind? Thanks, Su

Asked by Su, Seattle, WA Tue Aug 19, 2008

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Breaking a contract has it's consequences. What constitutes default is listed in the contract.
It usually describes time to perform as one of its components and loss of deposit as a possible solution for default
It is described as specific performance and it is bilateral. Each party is held responsible for their actions or non actions. It could be enforced by legal action.
0 votes Thank Flag Link Sun Jul 4, 2010
Su,
Refer to the document you signed. If you are a buyer, there are likely several ways to terminate the contract and not risk earnest money or more. If you are a seller, an opportunity may arise as the contract contingencies mature. Your agent would be your best source for advice. If you are talking about a listing contract, I would speak to your agent about your change of heart. Hopefully, the agent hasn't invested too much money (staging, marketing, mailings) already. But if they have you could offer to reimburse their costs. A sensible agent will understand your position and take steps to negate the contract. Either way, do understand that if you sell the house within a certain time period after the contract is cancelled or expires you may still be obligated to pay a listing commission. Read your contract and know your options.
0 votes Thank Flag Link Thu Aug 21, 2008
If you used a NWMLS agent who used MLS forms you have 10 days from mutual acceptance to verify any/all information you relied on when you made your offer. This clause is on page 5 of the basic agreement (Form 21 for residential). If you're beyond that date (it's based on calendar days) you'll have to look at the other contingencies that have already been suggested. You should know that it's common to question big decisions. It happens to everyone. Carefully take a second look at your decision to buy and try to get this natural emotional response out of your thinking. Buying now is a great decision. If you stick with it you'll probably be thanking yourself later.
0 votes Thank Flag Link Wed Aug 20, 2008
Ardell is correct that you cannot "change your mind," but there is approximately 5 days after signing when a buyer has options - possibly longer if a condiminium. The inspection contingency, if used, is another way out. If you used a purchase and sale agreement and you have negotiated and waived the inspection contingency, and the financing contingency, then the only way out may be to lose your earnest money. But speak to your agent or an attorney to be sure that is all that is at risk and to clarify the language of the contract.

If you are a seller, it is nearly impossible to get out of a purchase and sale agreement without risk of a lawsuit.
Web Reference: http://www.homehounds.com
0 votes Thank Flag Link Tue Aug 19, 2008
There are typically a number of contingencies in a purchase and sale agreement, and until a buyer waives all of those contingencies, the earnest money is not at risk. Some normal contingencies are: neighborhood review, financing contingency, and home inspection contingency. You should review your particular contract with your agent or an attorney and see what contingencies your agreement has, what you have waived and what contingencies are still active.

After you waive all of your contingencies, the earnest money becomes at risk (usually). Again, review your purchase and sale agreement and all attachments.
0 votes Thank Flag Link Tue Aug 19, 2008
This question appears to be asked by both buyer and seller. If so, and you both agree there should be no problem voiding the contract. If the seller wants out, it's not too easy but the buyer has legal outs in the contract. You may want to read the contract closely, have your agent explain your rights within the contract or see an attorney. Essentially, you should always read and understand any legal agreement. Tom Berg, Windermere, Woodinville Wa
0 votes Thank Flag Link Tue Aug 19, 2008
You have the right to "back out" on other things, but not "change your mind" so contact your agent immediately and find out what your "legal out clauses" are and don't tell anyone you "changed your mind".

You generally have five days to cancel based on the "Form 17" Seller Disclosure statement once received. Best to use a legal out. If it's a condo, you have a Resale Certificate "out" time. Most legal outs happen in the first 5 days.

Consult an attorney if you are not sure, especially if your Earnest Money amount warrants the legal fee. Don't delay and don't use "changed my mind" as reason. "Changed Your Mind" usually equals seller gets to keep your Earnest Money Deposit.

"Earnest Money" means you signed the contract in good faith to proceed and NOT change you mind, so changed you mind is almost never a legal out.

The only change your mind in WA that I know of has to do with a refinance of a mortgage.
0 votes Thank Flag Link Tue Aug 19, 2008
It really depends on what it says in the agreement. Are you referring to a listing agreement or an agreement as a buyer? In my experience it is easier for a buyer to "back out" versus a seller doing so. Either way, there is no set time frame that you have to decide on backing out, unless the real estate agent has written specific instructions within the agreement indicating you have only a certain amount of time to back out. One thing I would say is, the earlier the better. Decide now on whether you want to continue with the agreement or end it and read your agreement to make sure you can. When in doubt, contact your attorney.
0 votes Thank Flag Link Tue Aug 19, 2008
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