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Ask Jay, May 7
What to do after a broken contract
“The buyer now wants out of the contract to buy my home. The contract has been signed by both parties. What are my rights, and do I have to keep the home?”
Jim and Betty – Sterling
Dear Jim and Betty,
When people break contracts, you cannot generally force them to go through with the transaction. What you can do, if you can prove damages, is try to recover the damages in court or through arbitration. You can attempt to talk to the buyers and find out what the problem is and try to resolve it. It may be something you can easily resolve, but maybe not.
“My husband and I have already signed a contract to sell our home. However, we since changed our minds and no longer want to sell. Can we get out of selling our home?”
Suzanne and Paul – Leesburg
Dear Suzanne and Paul,
First, look at the contract and see if there are any contingencies that allow you out of the contract. You can always decide not to sell. You just don't know exactly what the buyers' reactions are going to be. You do not know if they will attempt to enforce the contract. You do not know if there will be legal repercussions.
You might want to get an attorney's opinion at some point, since we do not provide legal advice.
If you do cancel, think about ways to soften the blow to the potential buyer who has put up an earnest money deposit, may have already paid for a credit report and appraisal, and may be charged a cancellation fee by the settlement agent. They may have already given notice (if they rent) or sold their own house, too. If you reimburse them for some of their hard costs, maybe they will not try to enforce the contract.
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