AmI obligated to renegotiate a contract when the appraisal is below the contract price?
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AmI obligated to renegotiate a contract when the appraisal is below the contract price?
The contract has a contingency clause like most standard contracts based on obtaining financing. This was a lease purchase and the property value declined in the year that I have lived here. I don’t wish to purchase the home and it won’t appraise for the contract sales price. However, if the seller chooses to drop the price to the appraised value, am I obligated to purchase the deal? I want to walk away and get my monies back being held in escrow.
Asked on June 23, 2011 under Real Estate Law, North Carolina
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
You really need to bring the agreement to an attorney to review on your behalf. This is one of those questions that can not be answered unless one reads the agreement and does a little research under the law. If there is a clause that allows you to back out because of the issues involved here that you have written about - or as a result of the issues involved - then you may be able to just walk away and may not be obligated to re-negotiate the contract (which is what dropping the purchase price would be). As for the return of the money in escrow, the agreement should speak to that as well. Get help. Good luck.
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