Hart David Carson LLP on Backing out of Home Purchase Contracts

(Newswire.net — March 26, 2018) Elmhurst, Illinois — The decision to purchase a home is filled with many challenges. Securing financing, negotiating price, undertaking inspections, and navigating legal documents are all part of the process. In most cases, potential homebuyers enter into a real estate purchase agreement with the seller; this contract is legally binding unless certain circumstances force one to back out of it. Hart David Carson LLP, a leading Chicago-area law firm, has helped homebuyers understand their rights and obligations since the firm was first founded. “Entering into a contract between buyer and seller means that there are certain legal requirements to fulfill the agreement between parties,” says a spokesperson for the law firm. “However, there are a number of reasons where the potential buyer may wish to back out of a contract, and most states have specific allowances for those reasons.” To learn more about the quality real estate law services provided by the firm, visit http://hartdavidcarson.com/residential-real-estate.html.

Called “contingencies”, these exceptions to the legally binding language of a home purchase contract vary by state. These contingencies are typically part of a contact’s language and are usually in the form of a clause or stipulation. In certain situations, a contract can be nullified without legal consequence, such as:

• If the house in question fails required inspection(s)
• If the house needs extensive repairs to meet applicable codes
• If the terms of the contract favor the seller over the buyer
• If the agreed-upon purchase price exceeds the home’s appraised value

A mortgage contingency is one where the buyer is granted a specific period of time to secure a mortgage on the home purchase. Provided the buyer backs out before the time period is over, the contingency allows them to withdraw from the contract. Related to this exception is the so-called house sale contingency, which gives the buyer a specified period of time in which to sell his or her existing home. If the existing home does not sell within the time frame in the contract, the contingency once again allows them to back out without penalty. Homeowners may also have something called a “kick out clause”, giving them the right to continue to show and market the home while waiting for the buyers to sell their existing house.

Appraisal and inspection contingencies are two other common clauses in the home purchase agreement. In an appraisal contingency, if the appraised value of the home exceeds a monetary value contained in the contract, the agreement can be backed out of. This contingency is in place to help protect the home buyer, ensuring that he or she is paying a fair market price for the home. The seller may have a provision in which he or she can lower the asking price of the home in these situations. In an inspection contingency, the buyer has a specified period of time to schedule a home inspection. If this inspection turns up serious problems, the buyer can back out or request that the homeowner conducts needed repairs.

Hart David Carson LLP stresses to its clients that a real estate attorney is often needed to review potential home purchase agreements. With their expertise, the firm has helped thousands of homeowners and buyers reach mutually-acceptable agreements. For more information, visit http://hartdavidcarson.com/index.html.