When Real Estate Deals Fall Through

1. When Real Estate Deals Fall Through

2. Real estate transactions are among the most significant and complex types of financial dealings that individuals can engage in. Buying a property involves considering many factors and seeking out information to inform one’s decision. Due to the gravity of these transactions, legally binding contracts between buyers and sellers govern and facilitate these deals. Working with a real estate lawyer to craft such contracts is not uncommon. While buyers and sellers typically hope to complete a sale, that’s not always the outcome. Even experienced Edmonton real estate lawyers know that not every deal will conclude satisfactorily. When a sale falls through, those involved may have numerous questions. Let’s review the basics buyers need to know in this area.

3. When Buyers Can Withdraw From a Deal When a buyer enters into a contract with a seller, there is often the misconception that there is no way to exit the sale. That’s not entirely true, and it is also why the creation of a thorough, thoughtful contract is essential. The conditions written into that contract often protect buyers in certain situations.

4. For example, a contract may stipulate that the buyer is not obligated to proceed if they’re unable to obtain the necessary mortgage financing. A building inspection that reveals adverse information not disclosed by the seller can also serve as grounds to terminate the sale without incurring any financial penalty to the buyer. When a contract terminates due to said conditions, buyers typically receive their entire deposit back. However, simply changing one’s mind is usually not sufficient grounds to end a sale under contract. What Happens if a Seller Breaches the Agreement?

5. Some actions sellers take can imperil a sale. As mentioned, a failure to fully disclose a property’s defects and concerns, undertaken in bad faith, can constitute a breach of contract. Similarly, a seller may not possess a free and clear title to the property. Since they could not then legally complete the sale, a buyer may abandon the contract. When sellers breach the agreement, buyers are entitled to receive their deposit back in full. You may also choose to file a lawsuit against the seller for failure to act in good faith, engaging in nondisclosure practices or otherwise obfuscating the condition of the property.

6. Some sellers may also attempt to back out of a sale on their own. In some cases, buyers can file a court claim to compel “specific performance,” or forcing the completion of the sale. Such an option is only available in limited circumstances, particularly when the sale was very near to closing. If the deal was about to close, the buyer had satisfied their end of the agreement and there were no legal roadblocks to prevent the sale, a court may order the seller to the closing table. Learn Your Rights With Experienced Help

7. Ask a real estate lawyer in Edmonton what to know about purchasing property, and you’re likely to hear about the importance of doing your due diligence. Doing so can help you recognize when contractual conditions haven’t been met, which may allow you to walk away from a sale you no longer wish to complete. However, be sure to understand your contractual obligations and fulfill them thoroughly to avoid any breach. Are you purchasing property or concerned about the potential for a sale to fall through? Our experienced real estate lawyers in Edmonton are here to provide you with friendly assistance. Contact us today to learn more.