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I have a contract to purchase a house,
but the three owners are having a "family feud" and cannot agree on
anything. The sale of my own house closes soon and the lock-in on my
loan is up in a few days. What can I do? |
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| You may have to rent a
motel or move in with friends or family until the issue is resolved.
There is risk in buying real estate, especially when you make your own
moving plans very firm. No one can guarantee a sale will close on an
exact day because situations can come up unexpectedly, just as it
happened to you.
Fortunately (June 2000) rates have declined since you locked in
your interest rate. Most lenders will extend a lock (once it expires)
at the higher of the current market rate or the rate you originally
locked the loan. So most likely, you will not be hurting any on your
interest rate because of the delay.
In short, you're pretty much stuck and you have to hope the sellers
can work out their problems. |
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I agreed to buy a house and now
I’ve changed my mind. How do I cancel? |
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This may not be the
answer you were expecting....
For the answer to this, you have to look at your contract. The
contract is the legal agreement you have made with the seller. Most
contracts have certain contingencies where a cancellation is
acceptable. To cancel for reasons other than that, there are often
consequences and such a decision should not be taken lightly.
Keep in mind that while you have been preparing to close the
transaction, the seller has taken his home off the market and may have
entered his own contract to purchase a home. This can create a chain
of sales and purchases, all depending on you to fulfill your
obligation. If you do not fulfill the contract, your decision may
affect many more people than just one seller.
For the legal consequences of canceling a contract, you may have to
consult an attorney. |
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| 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
my home? |
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| When people break
contracts, you can't 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 easily you can easily
resolve, but maybe not. |
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| My
husband and I have already signed a contract to sell our home.
However, we have since changed our minds and no longer want to sell.
Can we get out of selling our home? |
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| 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 buyer's reactions are going to
be. You don’t know if they will attempt to enforce the contract. You
don’t 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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