Can you get sewed for damages for not closing?

Question

So I signed a purchase agreeement for 189k.(I'm the buyer) This agreement didn't have any contingencies- Appraisal or Financing. The property appraised for 164k. The seller's lawyer said, they'll come after me for damages if I can't buy the property/they can't sell the property for 189k. Am I in trouble?

Jake

Wayne Brooks · Answer

Depends on:

1) your contract

AND

2) State Law

Jake Walroth · Answer

Hey guys,

Thanks for all the input. We were able to work it out with the seller. @Kevin Sobilo I agree 100%.... that's what we ended up doing.... we agreed to meet in the middle and come to the closing table with 1/2 the difference in agreed upon price and appraisal... and will pay off the difference over the next 18 months.

Even though the appraisal wasn't ideal.... the cashflow/numbers all still work.... crisis averted, and I now know not to sign anyone else's contract!

Jake

Chris K. · Answer

@Jake Walroth

I know nothing about OH law but I assume you guys allow a lawsuit for specific performance. In such a lawsuit, the seller will ask the Court to order you to buy the property at the contract price. You'll have to check your agreement to see if the seller can recover attorney's fee as well. The agreement may also provide for other kinds of damages as well.

I would say hire a lawyer if you want to see if you can get out of the agreement and how bad your situation is. Based on what you wrote, you don't seem to be in a great position. But again, I don't know anything about OH law and I haven't seen any of the relevant documents.

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

Patrick Liska · Answer

There usually is some finance clause already in the agreement. If you filled out that you will be able to get a certain loan at a certain percent by a specific date. You can always go to your bank and have them send a denial letter for the loan, saying that they will not lend you the money due to the property not appraising for the value originally applied for. they then have no case against you and also have to return your earnest money.

Kevin Sobilo · Answer

Some sales contracts have a statement that says they can only retain the deposit towards damages. However if it doesn't state that then they could come after you for liquidated damages.

Why not buy the property? Appraisals are often not worth the paper they are written on and you signed the contract not caring what the appraisal came out as anyways. So, why do you want to back out?

Can you get sewed for damages for not closing?

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