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When can a seller cancel the sale of the house?

Buying a home can be a stressful experience. While it has its moments of excitement, including the handing over of the keys, you will likely go through a lot of frustrations to get to that point. Some of them you may expect, for example when the home inspection finds a list of issues to resolve. However, you may not expect the seller to back out at the last minute.

For a homeowner to go through the process of preparing the property and placing it for sale is no small feat. Therefore, it may seem unreasonable for someone who offers you the property to suddenly decide not to sell. In fact, it may seem like a breach of contract to you, especially after you have put your own time and money into the purchase of the home. You may be wondering if you have legal grounds to pursue a claim against the seller.

Terminating the sale

Most real estate experts would agree that, under many conditions, you have the right to pursue action against a seller who pulls the house out from under you without good reason. However, there may be certain circumstances under which a seller has the right to cancel the sale. Some of those include the following:

  • Your contract is still within the review period, and the seller's attorney advised the homeowner to cancel the sale.
  • You have a purchase contract, but either you or the seller has not yet signed it.
  • The contract contains contingencies allowing the seller to renege under specific conditions, such as the seller being unable to find a new home.
  • You have not met the terms of the contract, such as acquiring financing within the agreed-upon time.

Often, the sale comes to an abrupt halt following the home inspection. If your inspector found serious flaws in the home, the contract should give you the right to cancel the sale and walk away or to request those repairs at the expense of the owner. However, the contract may also give the owner the right to back out if he or she is not willing to make the repairs you request.

Going through with the sale

The seller may not cancel the sale simply because of a change of heart, especially if you have signed the contract and the review period has passed. Doing so is a breach of contract. If this happens, you have several choices to discuss with your attorney.

You may wish to force the seller to go through with the sale by taking him or her to Wisconsin civil court. Because this is often a long and expensive option, you may explore another course of action, such as suing the owner for the damages you incurred while trying to purchase the house. Your attorney may have suggestions for other alternatives.

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