Doesn’t the buyer have to give a reason for backing out?

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05/06/2014 | Author: Legal Staff

I accepted an offer on my home, and now the buyers are backing out. I thought they had to a give a valid reason—like that they can’t get a loan—but their agent says they don’t. Is that true?

It depends. If the buyers paid you for a termination option (see Paragraph 23 of the contract), they can cancel the deal for any reason within the agreed-upon time period. In that case, the buyers don’t owe you an explanation. You get to keep the option fee negotiated in Paragraph 23, but the earnest money will be refunded to the buyer.

If the contract does not include a termination option—or if the option period has expired—the buyers would be in breach of the contract if they tried to walk away without giving a contractually acceptable reason, such as not being able to obtain financing under the terms specified in the contract. 

Have a question about buying, selling, or leasing property in Texas? Ask us. Not all submitted questions can be answered. 

Categories: Legal, Buyers, Sellers
Tags: legal, selling, buyers, sellers, buying, consumers, contracts


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The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

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