How to Back Out of a Contract on a Home for Sale

Contracts are easier to get into than out of - but it can be done. Here are some strategies for getting out of your obligation.

Instructions

Difficulty: Moderately challenging

Things You’ll Need:

• Legal Counsellors
• Writing Papers
• Writing Pens

1. Consult a real estate broker or attorney and look for contingencies (loopholes) in the contract, such as inspections or documents that have yet to be approved. Write a letter to the seller that formally informs her that you disapprove of a particular, unacceptable condition or document.
2. Get a letter from the lender stating that, after further inspection of financial documents, the buyer (you) now does not qualify. Be prepared to show proof.
3. Provide documentation from an appraiser showing a lower-than-originally-assumed value for the property. (You'll still have to pay for the appraisal, but it's cheaper than buying the house.)
4. Be candid with the seller. Discuss the situation and see if the seller is willing to allow you to back out of the contract. By law, you can't be forced to buy the property, but depending on how the contract was written, the seller may be entitled to keep your deposit.

Tips & Warnings

• The purchase contract is a legally binding agreement, and failure to adhere to all agreed-upon items could have legal consequences. (In other words, you could be sued!)