You’re a few days shy of closing on the sale of your old home. The process has been smooth up to this point, and you’re already getting phone calls from the title office to schedule an official closing date and time that works for you and the buyer. There’s just one problem: the buyer has informed everyone that they are backing out. You’ve heard of the term “fail to close” before, but you never gave it much thought because it simply wasn’t something you thought might happen to you — especially within days of reaching the closing table.
But now it is happening — so now what? You’ve already committed to buying a new home, and your ability to close on that transaction hinges on proceeds from the sale of your old home. This is where having a real estate attorney in your corner can be a huge benefit.
What Is Fail to Close?
Although the majority of real estate transactions ultimately reach the closing table, some do not. Essentially, fail to close means that the buyer or seller didn’t complete the steps to finalize a planned transaction as originally intended. As a result, one or both parties attempt to terminate or cancel the transaction.
A fail to close can happen voluntarily or involuntarily at any stage of a real estate transaction, and a few reasons might include –
- Emotional reasons — The buyer or seller simply had a change of heart.
- Personal reasons — These can range from job relocation to job loss, financial difficulties, a death in the family, etc.
- Financing issues — The buyer or seller couldn’t secure adequate financing to complete the sale or purchase.
- A drastic change in home values — This could impact appraisals, securing insurance on the property, etc.
- Title defects — Liens, boundary disputes, and encroachments can delay or prevent a closing.
- Appraisal challenges — If an appraisal comes in lower than expected, it can create lending issues and a fail to close.
- Home inspection problems — Structural issues and large repairs may impact a buyer’s willingness to proceed.
- Contingency failures — If contingencies aren’t satisfied or waived in time, a party can terminate the contract.
What Are My Rights With Fail to Close Situations?
The specific reasons for a fail to close can vary dramatically from one real estate transaction to the next, which can impact what your rights and protections are moving forward. This is where having a real estate attorney on your side from the very beginning can be beneficial. Christman Attorneys, PLLC, has extensive experience in real estate law. We represent buyers and sellers in commercial and residential real estate contracts, assist parties in negotiating contracts, advise clients on title and property matters, and represent residential and commercial real estate developers.
We also litigate disputes, including boundary disputes, contested appraisals, suits arising out of breach of contract, condemnation proceedings, failure to close, title defects, breach of warranty, construction defects, liens, foreclosure, adverse possession, condemnation, and recording issues.
Please call Christman Attorneys, PLLC, for your legal needs today!
Please consult an attorney for advice about your individual situation. The material on this website and in this or any blog article we publish are for informational purposes only and do not constitute legal advice. The attorneys at Christman Attorneys, PLLC believe in tailoring legal advice and solutions to your own personal circumstances.
We have an unwavering commitment to helping our clients at each stage of their legal situation.