Sometimes you just get a change of heart. What was once an exciting opportunity to buy your first home soon turns into a bit of buyer’s remorse. You’ve changed your mind and decided not to buy that property after all. Can you?
Some contracts include a clause that allows you to back out of the deal. A sales contract is, in fact, a contract. It’s an agreement between you and the seller. You’ve put some earnest money down and it’s off to the races. But in those contracts, most of them allow you to decide otherwise under certain conditions, at least so you can get your earnest money back.
One way is after a review of a property inspection. Let’s say you make an offer, it’s accepted, you make a deposit, and pay for a property inspection. But the inspection comes back with some negative items. Most inspections will have things noted that need to be looked at but aren’t serious enough to cancel the deal. Some however are. The serious ones allow you to cancel the deal altogether.
Another way is after the appraisal has been performed. Let’s say you make an offer of $300,000 and the appraisal comes back at say $290,000. You now have some options. One of course is to renegotiate. Another is to come in with the additional $10,000. Remember, the contract states you agreed to $300,000. If you want to move forward, your lender will use the $290,000 as the value of the home for underwriting purposes. If you decide you’re really not in the mood to come in with more cash, you can walk away.
You might also be able to pay an additional fee upon execution of the contract to establish an ‘option’ period. An option period allows you to cancel the contract, for absolutely any reason, within the agreed-upon option period.
But after these instances have been addressed with the inspection and appraisal coming in okay, if you do decide to change your mind and walk from the deal it’s likely the sellers will keep your earnest money deposit. Remember, when a seller accepts your offer the deal is placed on a ‘pending’ status and is essentially taken off the market. If you get cold feet halfway through the process, the sellers will more than likely keep your deposit.
You can change your mind, it’s just a matter of when, how, and under what circumstances.
