Well, after accepting an offer and taking our home off the market for a full month as we go through the closing process, our buyer has backed out the literal day before closing. The papers were literally being signed tomorrow.
This was the only offer our house had after sitting for about 2.5 months. Now here we are. Back to square one.
We have a meeting with our realtor later today to discuss options. I just wanted to hear from some of you all — has this happened to any of you? How did you proceed?
Buyer just backed out day before closing. Devastated.
byu/Morbid_Explorerrrr inRealEstate
Posted by Morbid_Explorerrrr
21 Comments
I’m curious, did the buyer give a reason? Sometimes it’s something fixable. Also, I wonder if there’s anything in the contract about earnest money or penalties for backing out this late?
Good luck with your meeting today! I hope you and your realtor come up with a solid plan. Makes you wonder if “the perfect time” will ever really arrive, doesn’t it?
This happened to me. I even had the staging co remove all the furniture. Absolutely devastated. I got aggressive with the price cut that same day and had 3 offers the next day. It was VERY aggressive though but i had to sell asap. If i had held on in this market from last november to now, it would be 100k lower. So while it was hard to aggressively cut, it sold my house and I actually saved money compared to the market today.
Sorry unfortunate, but it happens. Hope you get to keep the deposit money, if not you could sue for performance. Maybe threatening a lawsuit will change their mind?
Sue for losses.
It’s free money, the buyer will now have to pay collateral as stated in the contract. Your house will sell in time, there’s no worries. Honestly if enough buyers back out you will be able to afford a second home.
Our house sat on the market off and on for 6 years. Two months is nothing. You’ll find another buyer soon in this market.
they proceeded just as you will – put it back on the market and start over. only ask for a larger deposit on the next one
Happens more often than people think, that’s why contingencies and earnest money exist. Dust it off, relist fast, sometimes the next offer comes quicker than the first.
really the only question at this point was will you be able to hang onto the deposit, or are they makin an argument for some kind of a breach from your side.
You keep the deposit, no? Should be a pretty penny.
The crap part of it is that people are going to assume there’s a defect with the house when they see it relisted after being taken off. Yeah, your realtor has a great answer for why it happened, but it’s enough to make people just keep on browsing when looking at stock.
This is the other side of the coin with sellers not wanting to see inspection reports when someone backs out. Buyers are left to assume that all failed closings are due to something really ugly that the seller is doing their all to avoid knowledge of before the sale.
This is a situation of take their EMD and move on to the next.
For future deals, I would make the EMD amount be higher, keep the home on the market until contingencies are lifted, and I would accept backup offers.
Chin up! Take a day and the next one will come.
This happened to us a year ago. Please don’t lose hope, we sold this year! Yes it was a nightmare but we found BETTER buyers. We did take our house off the market last November and then relisted this Soring. It sat for 2 months then had a bidding war between 4 parties within 12 hours. Don’t lose hope. We did keep the earnest money and the closing attorney said he had never seen anyone get to keep such a large amount. I hope that you get to keep the earnest money. I am sorry this happened to you, we were devastated and lost the home we wanted. We did find a new home this year that is different but equally as wonderful.
How to proceed? Re-list. Not much else you can do.
But before that, be on top of your realtor so he gets escrow to release the earnest deposit to you ASAP.
It is not that the earnest money is automatically released to you. There are usually forms to fill-in, etc. Escrow office can be a PITA about that. Many times paper work fall through the cracks and it takes a long time to get the earnest deposit.
Hopefully you have a good agent that knows how to navigate these situations efficiently.
Our buyer backed out because she suddenly felt evil spirits in our home
Then she tries to sue us for her time trying to buy our house… Like miles on her car, internet time, time with her realtor, time thinking about buying our house, ..,..
Crazy. Case never went to court.
Maybe you should’ve negotiated more?
can you rent it out for a while?
You’ve got two decent options: Price it to sell quickly or rent it, if restrictions allow that. Or the dynamite option, depending on your equity in the house, let it go back to the lender.
Consider the earnest money you retained, a couple of months mortgage, and the $25K below list you took as reductions from your original list price and go from there on pricing.
We had this happen, we were lucky because earnest was only $1500, but with our state rules and the buyers wanting out fast we negotiated 10k in “damages” for loss of time, personal repairs that the original buyers wanted (small things that would not be deemed needed by most).
What I did because our realtor was terrible, but so were all of them in the area, I said just take the 10k, offer it as a sellers credit, and repost it at the price we were under contract for. We got an offer within the week and ended up closing 3 weeks later than we were originally scheduled for. Was super stressful and our realtor did not help (she was reactionary rather than proactive). Worked out in the end and I think after closing costs, etc, we ended up with 2k less than we would have had the first offer finished out.
All you can do is take the forfeiture of the EM and move on.
If you’re sitting for that long without offers, you’re definitely overpriced. If you can’t accept a lower price, then you probably won’t sell.