What to do about a breach of a real estate sales contract?
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What to do about a breach of a real estate sales contract?
I made an offer and placed earnest money on a 4 plex contingent upon repairs which were noted in the inspection I paid for. The owner made the repairs and then decided not to sell. What is my recourse on this written contract?
Asked on November 1, 2012 under Real Estate Law, Alaska
Answers:
B.H.F., Member, Texas State Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Because this is a contractual obligation, then your remedies are generally limited to those in the contract. So your starting point is to look at the contract. Most will provide for some type of refund of earnest money when the seller backs out. If the contract provides that the funds are to be returned within a certain time frame and he is refusing, then you can file a civil suit for breach of contract. Make sure you follow any requirements set out in the contract for demanding the return to avoid a waiver of any remedies.
If you had a very poorly written contract that did not award the return of the funds, you may still have some remedies. If you can prove that the seller took your earnest money and never really had an intention of returning the funds, then you may have a theft by fraud type of criminal charge that you can file with your local law enforcement agency.
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
I suggest that you consult with a real estate attorney with respect to the seemingly agreed upon contract as to filing a specific performance action and recording a lis pendens as to the property in order to get an order from the court compelling the seller to sign a deed transfering title of the property to you through an established escrow.
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