If I back out of a home purchase 2 weeks prior to closing, other than the loss of my earnest money do I owe any other fess?
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If I back out of a home purchase 2 weeks prior to closing, other than the loss of my earnest money do I owe any other fess?
Either to the lending institution, broker or real estate agents?
Asked on December 16, 2012 under Real Estate Law, Indiana
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If the seller has incurred costs or losses due to you breaching the contract of sale and those costs exceed the amount of earnest money, the seller could sue you for the extra. For example: say that in reliance on your offer to buy the seller's house, the seller offered to buy another home and put down a larger deposit than you did. If because you do not buy his home, the seller can no longer afford the house he wants and breaks his contract, losing his earnest money, he could sue you for the difference (and also for, say inspection, appraisal, or title costs he incurred).
As to lender and broker, whatever you may owe them will have been spelled out in the agreements, loan applications, etc. you signed.
It's possible that the realtor, who has lost a commission due to your breach, could try to recover some or all of it from you. Usually they do not, but it is a theoretical possibility.
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