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Home purchase offer: Breaking the contract Illinois

Whether you can back out of buying a home without it costing you a lot of money depends on your contract.

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Buying a home is a big decision. And sometimes, after making a home purchase offer, you may decide you’ve made a mistake. Is it too late to back out once you’ve signed a contract? Not necessarily.

When you are allowed to back out

When you sign a purchase offer, you may stipulate certain conditions in the contract. If the seller agrees to these requirements, then you are allowed to back out of the deal if the conditions aren’t met. For example:

A home inspection. It’s always wise to stipulate that your offer is conditional upon a home inspection. If the inspector finds any problems that you did not anticipate or that you find unacceptable, and the homeowner refuses to correct these problems, this is an opportunity to back out of your decision to buy the home without penalty.
A home appraisal. You may also be able to back out of a home purchase offer without penalty if you’ve stipulated your offer is conditional upon an appraisal and the appraisal comes back with an estimated value that is lower than the selling price of the home. This can be important, particularly if it results in your lender refusing to grant you a sufficient mortgage to cover the cost of the property.

Backing out at a loss

You can also back out of your home purchase offer at any time prior to closing without a reason. If you do so, however, you will most likely to lose your “earnest” money (the percentage of the purchase price you paid up front). Backing out of a home purchase offer in this manner usually creates a stressful situation for both the buyer and the seller. It’s therefore something you should try to avoid. It’s always better to weigh your decision carefully in advance. At the same time, it’s important to know that you are able to back out if you feel you’ve made a mistake.

Published on January 12, 2007

Read full article at realestate.com

Featured Local Company

James W. Klopfenstein & Associates, Inc.

3096739111
320 E. Jackson
Peoria, IL

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Advertising	Family	Home Services	Real Estate Resources
Business Services	Fashion	Industrial Goods & Services	Retail & Consumer Services
Career	Financial Services	Insurance	Software
Cars	Food & Beverage	Internet	Technology
Computer Hardware	Franchise	Legal	Telecommunications
Construction	Health	Miscellaneous	Trade Shows
Education	Holidays	Nightlife	Travel
Entertainment	Home Appliances	Online Database	Weddings
Environmental	Home Electronics	Pets	World History