Dear Real Estate Adviser,
If I signed a residential contract as a homebuyer but the sellers haven’t signed it yet, am I still contractually bound?
— Stephany M.
Not yet, but time is of the essence. While you may eventually need to have an attorney pore over your contract, your first move should be to call your real estate agent and instruct him or her to immediately email or fax the sellers to inform them that you’re withdrawing your offer. That is, assuming you really want out.
In most instances, if you and the seller don’t have a fully executed purchase agreement, then you don’t have a deal. A spoken agreement is seldom binding. After you cancel your offer in writing, any earnest money you proffered should be returned.
Hope that an issue crops up
But if buyer-signed papers are already on the way, you may have a slight problem. However, if there’s any missing contingency — a disclosure, your inspection, a mortgage approval issue, etc. — then you can likely skate anyway. The above scenario, by the way, may be the only one that could conceivably cost you earnest money, though again that’s not likely.
Seller hesitation is your friend
Chances are, if you didn’t hear back from the sellers right away, they may be pondering a counteroffer or are delaying as they entertain other offers. In other words, the loss of your offer may not matter to them if others are waiting in the wings.
What’s your state of mind?
Something else to consider: If time allows, you might do a little soul-searching about your reasons for pulling out. Do you just have “popsicle toes” (buyer’s remorse) because of the transaction’s magnitude? Is this the home you liked best of all those you’ve toured? Do you still need to buy a house to replace the one you’re selling? Are you missing out on a genuine opportunity? If you do reassess thusly, do it quickly. If your gut says “no go,” then cancel.
Write it down
But make doubly sure your cancellation request is in writing. Ask your agent for a copy. Some agents may, um, conveniently delay forwarding this sort of thing to sellers in hopes of getting back a signed contract. If you do meet any resistance or receive threats about earnest-money retention or lawsuits, then see an attorney.
And do make sure your next offer is a wholehearted one. Good luck!
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