Getting your money refunded
Your Dunedin Home Inspector will advise you that the best time to think about canceling an agreement is when you sign an agreement. Any kind of agreement.Whether it’s an agreement to purchase real estate or a buyer’s brokeragreement, documents to refinance a mortgage, a listing agreement, any document that binds you to perform.
Before you sign legal documents such as these, ask how you can cancel if things don’t work out the way you hope or if you change your mind. If you don’t receive a satisfactory answer or you can’t figure it out yourself by reading the cancellation clauses, then don’t sign until you have a lawyer review it and advise you. Here is what you should know about canceling listing agreements.
Why Withdrawals Happen
Sometimes the unexpected can happen to a prospective home buyer, who decides he or she cannot go through with the purchase of a home. What matters is that if you have to cancel a home purchase, announce your decision as soon as possible, in order to avoid losing money and causing the seller unnecessary hardship.
The most common reason home buyers withdraw from their purchase contract is because they can’t secure a mortgage commitment under the terms defined in the contract. Other scenarios for backing off from the deal: You found a home you liked better, or the real estate attorney who just reviewed your contract tells you that the terms to which you agreed benefit the seller much more than you. Or, you and the seller sign the deal, but during the contingency period, your Dunedin home inspector finds the property needs important repairs for which the seller doesn’t want to pay – and neither do you.
Ask About Cancellation Upfront
Before you sign a listing agreement, ask your agent if you can be released for any reason, even if that reason is, “Hey, I want to list with another broker.” If your agent tells you “no,” then you might not want to list with that company. If an agent says it’s company policy, then that is not a company with whom you want to do business.
Put it in Writing
It’s relatively easy to withdraw your offer if the home’s seller has not yet signed the purchasing contract. As long as you don’t have written acceptance of the contract by the seller, you are still considered to be in the negotiating stage of the home-buying process. If you change your mind at this stage, have your real estate agent or attorney draft a letter to the seller’s representative, stating that you are withdrawing your offer. And because you should never deliver any earnest money deposit to the seller or his agent until all parties have signed the purchase contract, there should be no earnest money deposit to recoup.
Withdrawing from a purchase contract after the seller has formally accepted the contract in writing can be a more daunting experience. If the date of your decision falls within what’s called the contingency period, during which, for example, an attorney reviews the purchasing contract, or your mortgage is being worked out and confirmed, the cancellation requires a formal, written procedure.
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