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Posted by
Cheryl Meriggi

Can a Seller back out during the Option period?

I understand that the option period is for the buyer but what are the ramifications if a seller chose to back out because the backup contract was better suited for them? The seller's new home will not be ready until December and they are forced to find an apartment BUT the backup contract is CASH and they will allow the sellers to live in the home RENT FREE until their new home is ready.

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Can a Seller back out during the Option period?

By Cheryl Meriggi   
Posted on Apr 22, 2014 in Topic: General
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I understand that the option period is for the buyer but what are the ramifications if a seller chose to back out because the backup contract was better suited for them? The seller's new home will not be ready until December and they are forced to find an apartment BUT the backup contract is CASH and they will allow the sellers to live in the home RENT FREE until their new home is ready.
Status: Open
Viewed: 38673
Asked by: Consumer
Posted: 8 years ago
Topic: General
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Gold
Dori Lacamu
about 8 years ago
You should really consult your agent or an attorney. There is no "option" period for a seller. Once the seller has signed a contract they are "locked in" to the contract.


about 8 years ago
Diamond
Darby Grimmett
about 8 years ago
Hi,

When I read through your question to first thing I wanted to know was whether or not the first contract was a contingency since with a contingency contract the seller can give notice to the buyer under contract that another offer has been received and considered. At this time the buyer has the option to, according to their signed Addendum of Sale of Other Property, waive the contingency, deposit additional earnest monies with the title company, or terminate their contract.

However, if the first contract is not a contingency contract then the seller is not able to "back out" of the contract unless the buyer defaults in someway (and there are various ways a buyer can, in fact, default).

I would question the validity of an offer, cash or not, in which the buyer agrees to allow the seller to live in the property rent free for 8 months. Something doesn't add up there in my opinion.

The moral of the story...when in doubt, contact an attorney. :)

It should be mentioned that one should never sign anything he/she does not fully understand and the TREC contract specifically states to contact an attorney before signing if one does not understand.

Hope this helps!

Darby Grimmett
Keller Williams
936-827-9217
darby@darbygrimmett.com


about 8 years ago
Bronze
Chris Wages
about 8 years ago
No. The Option Period is for the Buyer only.


about 8 years ago
Bronze
Diana Walton
about 8 years ago
Based on your question, it is best that you consult with your agent or a Real Estate Attorney.


about 8 years ago
Diamond
Cagdas Acar
about 4 years ago
Dear Cheryl,

Answer is No. The contract ties both side while seller does not have option period to exit. Unless Buyer defaults Seller can not terminate the contract.

Regards,

Cagdas Acar
Msc, PSA, Realtor@
Phone: 832-283-1091
Website: www.cagdasacar.kw.com
Email: acarster@gmail.com


about 4 years ago
Bronze
Joseph Higgins
about 3 years ago
Very nice write-up. I absolutely appreciate this website. Thanks!
192.168.254.254


Source:


192.168.2.1


about 3 years ago
Diamond
Joe Applewhite
about 1 year ago
The seller can only refuse to negotiate at this point. The sellers could be in default if they try to back out now.


about 1 year ago
Platinum
James Meador
about 11 months ago
In the scenario you described, the seller cannot simply "back out" of the contract because there is a better offer on the table. The option period is a protection for the buyer only, and only the buyer can "opt" out of the contract during the option period. If the buyer decides to continue with the purchase, so must the seller. The seller can refuse to negotiate repairs or offer concessions based on the inspection and can make the transaction extremely difficult to close by not conceding anything else down the line, such as an extension for appraisal or lender delays or any of the myriad other problems that can arise. If the seller does try to get out of the contract, you should consult a real estate attorney. Hopefully, this situation worked out for everyone involved.


about 11 months ago
Disclaimer: Answers provided are just opinions and should not be accepted as advice.
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