what can I do to cancel an escrow to sell my house?

Question

I accepted an offer, but now I don't want to sell anymore!

Answer 1

This is not meant to substitute for legal advice. I strongly recommend you seek the advice of an attorney in your state who can best tell you of the laws of that state. With that in mind. . .

You need to read the Purchase Contract carefully to see if there are any "contingencies" that would allow you to cancel the sale. Contingencies are those things that the Buyer is supposed to do in order to go through with the purchase of the property. Many purchase agreements have strict deadlines for demonstrating that they qualify for loans, make deposits, or perform certain inspections or grant certain waivers for some terms in the Purchase Agreement. It is possible that the Buyer will default on one or more deadlines which would allow you to declare a breach of the Purchase AGreement that will allow you to cancel the deal.

Alternatively, you can also discuss with the buyer directly, about your change of heart and ask them if they are willing to cancel the deal. Sometimes you can pull on enough heart-strings to convince the buyer to let you out of the deal, especially if you are not wanting to sell for sentimental reasons. But if you are trying to get out of the sale because you found someone to pay you more money for the property, it's not likely they will want to get out of it.

Read your Purchase Agreement carefully as it may have a clause that requires you to give certain notices to the Buyer if you intend to cancel and what sort of deadlines you have to give these notices.

Bear in mind this, if the buyer is purchasing your property as part of a 1031 exchange, they are not likely to want to cancel the deal. If you refuse to sell it could open you up to a lawsuit for damages for the taxes they end up possibly paying as a result of not finding a suitable 1031 exchange before their own deadlines expired.

So you can see this is a complex question you are asking, so it is best for you to see an attorney quickly so that the buyers cannot claim that they have detrimentally relied upon your agreement to sell to them and now they are damaged and want you to pay damages.

Hope that helps.

Answer 2

You don't say which State you are living in and whether or not you signed a standard purchase agreement or if you are represented by a realtor.

What ever you do, DO NOT go to the buyer and speak with them directly. Those conversations can blow up in your face if there is a legal wrangling of some sort. Your realtor can handle this for you. If you don't have a realtor, then find one who is the "best of the best" and pay them to help you get out of this. Either that, or hire an attorney to do it. This is not something you want to go cheap on. Pay some now, or pay a lot later.

If this was a sale that is contingent upon some type of action on your part, then use that clause. If no one can seem to find a way out, you can always refuse to do any repairs, make sure you report every noisy neighbor, structural problem, etc., on your state-mandated disclose forms to the buyers. With all the houses on the market right now, if they won't let you out of the contract, you can be uncooperative to the point where they may feel it isn't worth it and move on to another house.

Answer 3

You really should get an attorney to discover any of the terms and conditions and contingencies that are required as performances under the contract. These clauses will lead the attorney to determine whether you do have the ability to cancel the contract and it would most likely be premised on the inability to perform under the contract and not merely on a wish to cancel the contract. If you merely cancel the contract without mutual agreement with the buyer, then the buyers would have a cause of action against you for any monetary damages that they would incur as a direct result of your cancelling and in addition they could take you to court and have the judge force you to perform under the tems of the accepted offer.

Answer 4

Having gone through this as the buyer whose seller tried to back out of the deal, you had better hope that your buyer fails to qualify for a mortgage or finds something wrong on the inspection and decides to pull out of the deal themselves. Because if they don't, they are going to get your house!

I won't go into all of the gory details here but after we finally agreed on a price (a bit contentious as the bubble had burst and he was taking a bath but that's another story) and had gone to escrow the seller suddenly decided that he was not going to sell the house -- no reason given. We were good to go on the mortgage, the inspection was good, just waiting on the termite inspection when our agent called and asked us if we'd be willing to cancel the deal.

We refused (it really was our dream home at the time) and the seller started playing games refusing to allow the termite inspector in the house, etc., yadda, yadda.

I wound up getting an attorney to write him a letter threatening a lawsuit before he came to his senses.

He followed through with the sale but after closing he was still in the house, claiming that his new place wouldn't be ready for 2 more months and we'd have to wait. I had to evict the bastard to finally get posession of my own home!