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What are the implications of not closing a realestate new house deal?

samcansam

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Sep 11, 2007
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My cousin signed a contract to buy a new house. Now he is nervous and does not want to close the deal as his house is not selling. What are the implications of not closing the new house deal with the builder:
- Will he lost the deposit (5%), or
- Could he ask for part of the deposit, or
- Could the builder go after him for compensation?

Thanks for the advice in advance.
 

marcp

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Aug 30, 2007
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Where is your cousin`s house?
style_emoticons


When does he need to close?

Cheers,
Marc.
 

NickStewart

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QUOTE (samcansam @ Oct 23 2007, 10:04 PM) My cousin signed a contract to buy a new house. Now he is nervous and does not want to close the deal as his house is not selling. What are the implications of not closing the new house deal with the builder:
- Will he lost the deposit (5%), or
- Could he ask for part of the deposit, or
- Could the builder go after him for compensation?

Thanks for the advice in advance.


Pretty hard to answer any of those questions without knowing what the contract your cousin signed states.

There might exist an opportunity for him to sell the contract to someone else...
 

DonCampbell

Investor, Analyst, Author, Philanthropist
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Aug 22, 2007
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Hi,

Bottom line is that each purchase agreement is written differently to others. In that contract it will clearly lay out what will happen if he breaches the contract. In some cases, not only will he risk losing his deposit, but if the market has moved downward from the price he agreed to pay the build could sue for damages/loss due to the breach.

It might make more sence for him to find someone to take over his purchase contract and assign it over to the new party.

Read the contract and all will be revealed.
 
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