Q: I am buying a residential property that is being sold by owner. The escrow is a very long one (2 1/2 months).
About halfway through the escrow, and well past the point of no return, I discovered that home prices in this neighborhood were starting to fall. They were falling so much that my great deal was not even a good deal any more.
I informed the seller that I felt I was paying too much for the home but she told me “too bad, too sad”. I have canceled the agreement but she has not signed the cancellation form and is contacting an attorney to try and force me to buy the property.
Can she do that? Is there a way out for me? I do not want to buy this home any longer but I feel I am stuck. The escrow closes in about 4 weeks. Help!
A: You’re having buyer’s remorse. Unfortunately, unless you made that a condition of the contract, having a bad case of buyer’s remorse doesn’t give you the legal right to bow out of the deal.
If you don’t purchase this property because you suddenly feel it’s a bad deal, the seller may be able to sue you for damages. Her damages could be the difference between what you originally agreed to pay for the home and what she was able to get later on.
Perhaps you should make her an offer she can’t refuse. Perhaps you and she can agree that she gets to keep any cash you put down on the deal if you can walk away.
Although the escrow is longer than some, it’s isn’t out of the ballpark. I am interested that you have seen property prices drop so much so quickly. It is unfortunate that you were unable to discern the true state of the market (which might have changed in the past few weeks) before you signed on the dotted line. By the way, if the escrow had been a very short period of time, you would already own the house and see the value of your house go down.
For more details on your legal options, please consult with a real estate attorney.