Among many important clauses of a real estate contract, an important clause is the one that defines about the consequences of cancelling the contract and still most seller put a very little attention to this significant default clause before signing the contract until the decide they need to cancel the real estate contract. While cancellation of a real estate contract by seller does not happen very often, at times it could happen and expose the seller for substantial legal risks and financial losses. Therefore, there is a need to realize about the possibility of cancellation a real estate contract by the seller.
If you find yourself in a situation where as a seller you need to cancel a real estate contract, you should be aware of the fact that the real estate contract you signed is legally binding at the end of both signing parties. However, if you still want to cancel a real estate contract as a seller the initial step should be to discuss the circumstances with your realtor or real estate lawyer. The legal experts could assist you in contemplating your options and might find out a way through which you could get out of a real estate contract without further hassle but you would be required to return the deposit money back to the buyer and there is a possibility that as a compensation buying party would demand their deposit money back with interest.
This means that as seller you might be able to cancel a real estate contract, but once you have get yourself in such situation, the buying party might also demand you to compensate for their further loss such as the expenses incurred to buying party in terms of inspection charges, real estate lawyer fees, etc. There could be a possibility that the buying party has also sold their current house in anticipation to move into their new home, which might also make the seller pay for their temporary housing until they find another place to buy. One more probable issue would be associated with the increase of interest rate at the time the seller decided to cancel the real estate contract, in comparison to the rate at which they locked. This scenario could also make to pay for their mortgage rate also.
Always remember that if you tend to cancel any legal contract once you have signed, it would cost you a lot more than you could have anticipated. Once you decided to sell you property, you must have a profound understanding of all such cost associated with the cancellation of a real estate contract. A few sellers might not realize the consequences of signing a real estate contract, which is legally binding and a seller just cannot expect that a buyer who has already planned to buy your property would accept this without any hassle. The buying party would have visible chances of winning if they decides to sue a seller for performance.