Can a seller renege on an executed purchase contract and sell to someone else?

Asked by Melissa4584, 29072 Tue Apr 20, 2010

I have a signed purchase contract and earnest money has been placed in escrow. now the seller is trying to renege on the contract and we saw on craigslist that she put the house back on the market and is asking for 10k more than what she is selling it to us for. She said she is backing out of our offer bc we want a home inspection done and she has decided that she does not want one even though it is in our contract to be able to have one. I have a bunch of nasty emails from her telling us that we're extorting her bc we asked her to uphold her end of the contract or we would go to court for failure to preform. I really dont want to court over this but she has made it clear she is not going to sell it to us and we really want this house since we've already sunk a ton of money into the purchasing process.

Help the community by answering this question:

+ web reference
Web reference:

Answers

14
Kelly Putz, Agent, Fairfax, VA
Wed Apr 21, 2010
Hey Melissa,

The fact that you have received emails from this seller sort of indicates that you might not have a real estate agent involved, as typically the buyer and the seller never have contact until settlement. Your case is an excellent example of why. Purchasing and selling a home is a very emotional process and having a real estate agent or attorney act as your middle man helps to keep it just a business transaction.

I am not an attorney, so the following is merely my opinion. Going on the assumption that you don't have an agent, if your contract had a home inspection contingency and both you and the seller signed off on everything when you entered into the contract, then you have a ratified contract in which she agreed to a home inspection. If she is not allowing you to do a home inspection and is now seeking other offers, then she is in default of the contract. Go speak to an attorney today!

If all of the above is correct, and you still want to buy the house after the home inspection, you CAN make her sell the house to you at the agreed upon price because you have a ratified contract. She can also be made liable for all the attorney and court fees involved. I'm not sure what you mean about having sunk a ton of money into the purchasing process, as the only money that should be involved at this point is your Earnest Money Deposit, which should be held in escrow as you mentioned. As the seller is the one in default, you are entitled to have it returned to you.

It can be a hot mess, if you're willing to go through all that for this house. If not, I highly recommend getting a buyer's agent to help you find another house.
1 vote
Annette Law…, Agent, Palm Harbor, FL
Wed Mar 21, 2012
Wow, the joys of dealing directly with the home owner!

Now, I'm not an attorney, but if you want this home, you should consult one immediately. The attorney can make any sale of the home to another party very difficult.

Now, there is so very much we do not know about this situation. You have not shared any provisions contained in the purchase agreement that suggested there was an inspection contingency included. If this contingency has not been explicitly provided you may have erred. There may also be provision in the purchase agreement stating the home is sold 'as-is' and the buyer must exercise their due diligence prior to submitting an offer. The stated time period for the inspection may have lapsed! There is just so much we don't know.

Now that such a mess has been created, more fees will be incurred and a truly adversarial possibly 'smoldering ruins' environment is being created. One of the roles a real estate professional fills is being the intermediary through which communicates, not reflective of the emotion of the moment, are channeled. In such circumstances, these professionals, keep everyone focused on the GOALS not the perceived transgressions.

Choose carefully the course you choose. Adversary or common goal. Be aware, you are moving into the home owners community. Proceed with care and by all means, chat with an attorney.

Best of success in purchasing your new home.
0 votes
Antoinette, Home Buyer, New York
Wed Mar 21, 2012
Can the seller renge on the contact for a house? I am in the process of buying a house...it took an extremely long time for a closing date to be had. I am buying throught the VA. My lawyer called me and said that we can set a closing date. The seller's lawyer is not working with my lawyer. They are not agreeing to set a date forclosing. On Tuesday all my paperowrk expires? What do I do then. I am already to move. Can the seller back out of this deal?
0 votes
Kelly Putz, Agent, Fairfax, VA
Fri Apr 23, 2010
Hey Melissa,

Boy, it sure sounds like you already have a hot mess with that seller. Unless you are just in love with the house, I would advise you to just walk away from it and let her be someone else's problem. If she is doing owner financing, do you want to be dealing with her for the next 15-30 years?

If financing is an issue, go talk to a local lender, it's free to talk to them. You might be surprised by what you can qualify for and what programs are out there. If you know a real estate agent you might want to work with, they can probably recommend several lenders, or vice versa, as we tend to have good working relationships with each other.
0 votes
Maureen Cody, , Charleston, SC
Wed Apr 21, 2010
Melissa,

I does sound like a stressful and difficult situation. Are you even sure you want to pursue dealing with this person? The closing attorneys who you state were involved with some sort of revision - are probably the best attorneys to contact to figure out this contract. Your attorney's advice will be your guidance.

If you do not go forward with this contract, I advise you to use a lic Realtor for any future transactions. Realtors can negotiate for sale by owner deals - and it would be providing you with the best representation.

Good Luck with it all!

Regards,

Maureen
0 votes
Melissa4584, Home Buyer, 29072
Wed Apr 21, 2010
Thanks to everyone for the answers. To shed some more light on the situation. We are buying this home via owner financing. This is the second closing company that has dropped her and refused to be her representation because she keeps trying to renege on the contract. The first time she tried to back out was because she wanted more money down after we agreed on and paid a set price for down payment/ earnest money. Now the second time is because she found someone else who is willing to pay her 10k more than what she is selling to us for. So now she's trying to say that our contracts aren't valid (we have an orig. signed contract and then our closing attorneys made a revision and added the home inspection and she signed that) and she's saying she wasn't in sound state of mind when these contracts were signed. She is now saying she is going to allow the new buyers to move into the house and rent it until we release her from the contract. No where in either contract does it say we give permission for her to bring in a new tenant. In fact it says the house has to be owner occupied at close on 4/30. I will be calling a real estate attorney today. Thank you to everyone for the answers!
0 votes
Too many redflags I'd run from this deal if you can..
Flag Wed Feb 4, 2015
JP and Jen P…, Agent, Columbia, SC
Wed Apr 21, 2010
Melissa,

If your contract is properly executed and she decided to default on the contract of sale you have every legal right to pursue legal action against her. I hope you and ther seller have real estate agents involved in the transaction, this should ease the process and ensure that all the T are crossed and I dotted...it would only take a missed initial on the contract for it to not be considered valid in the courts.

If you wish to continue to execute the contract of sale and purchase the home, have your closing attorney send her a letter saying failure to allow you to do home inspections will cause a default in her part and could result in legal action against her. A letter from an attorney goes a long way...

If she decides to have allow the inspection be prepared to purchase the home as-is...I am sure she will not agree to have any repairs done, at that point you may just want to walk away from the purchase.

If I can be of help I am only an email away or feel free to call my cell.

Have a great day and good luck...there are pleanty of homes out there...this home may not be worth the headaches!

Sincerely,

Joseph (JP) Piccinini - 803-873-0533
2009 Lexington's TOP Selling Agent
lexingtonscrealestate@gmail.com
http://www.jphomesforsale.com
0 votes
Wojcik Maril…, Agent, Gettysburg, PA
Wed Apr 21, 2010
No, at the point that you have a ratified contract to purchase you have what we call equitable title in a property which can be pursued by the court and the sellers will be forced to sell it to you by the courts.
0 votes
Maureen Cody, , Charleston, SC
Wed Apr 21, 2010
Melissa4584,

In the SC Agreement to Buy and Sell Real Estate (residential) -clearly provides the buyer the right to a home inspection as it states on page 3of6 section 19 B. It always goes back to how the contract was written. Did you do this on your own? Did you use this contract? Do you have representation from a licensed SC Realtor? Who is holding the escrow? So many details that would impact your rights at this stage.

If you used this SC contract, and if you entered a date to perform the home inspectionn by, and all parties signed - then the document becomes a legal binding document and you would have a right to sue for performace. However if the contract was written by some other means - many things could interfer with your rights.

As with an earlier response - I am not an attorney. You really should consult with your Realtor and closing attorney.

Best wishes,
Maureen
Search the MLS
0 votes
Mack McCoy, Agent, Seattle, WA
Tue Apr 20, 2010
Executory. It's only an executed purchase contract when the obligations have been executed.

Outside of the court system, you don't have any way to force her to sell the home to you.

All the best,
0 votes
Mike & Darle…, Agent, Lexington, SC
Tue Apr 20, 2010
Melissa,
Is there a Realtor involved in this sale? The Realtor can help you with this situtation. If you do not have a realtor then you will need to contact a real estate attorney. If you want to get your money back that you've spent so far you may want to contact the magistrate court to get advice. In answer to your question though, yes the seller can renege on an executed contract but it could cost the seller. If you do not have a Realtor there are quite a few real estate attorney's in the 29072 area that are qualfied to help you. If you need an Accredited Buyers Agent if this sale falls through please contact me.
0 votes
Alan K, , Westminster, MD
Tue Apr 20, 2010
It sounds like the law is on your side. (Of course, I've only heard one side of the dispute). Have your agent contact the seller's broker (if she has one). If she doesn't (i.e., it's a FSBO), hire a lawyer and sue for performance and expenses.
0 votes
Anna M Brocco, Agent, Williston Park, NY
Tue Apr 20, 2010
Consult with an attorney who specializes in real estate---check out all your options and consider a possible intervention --you have the right to conduct an inspection, and the seller really can't prevent you from doing so
0 votes
Tim Cahill, , Arlington, MA
Tue Apr 20, 2010
Caveat: I am not a lawyer and am not qualified to give legal advice. You should contact a local real estate attorney for a definitive answer. With that said...

By all rights, you have a right to a home inspection and she can't prevent you from doing that. The Offer to Purchase and/or Purchase & Sale agreement will usually state this explicitly. You should consult with a local real estate attorney if you haven't already done so - and FAST! She's in complete breach of contract and you can force her to perform via court action.

Best of luck!! Let us know how it works out.

--Tim
0 votes
Search Advice
Search
Ask our community a question

Email me when…

Learn more