Can I cancel a purchase agreement 2 days before closing?

UPDATED: Sep 30, 2022

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Can I cancel a purchase agreement 2 days before closing?

The loan officer I’m working with failed to make an adjustment to my closing documents that has now affected my closing date which was supposed to take place in 2 days. It has been pushed out another 4 days. I have no where to go my current home is closing in 2 days, I’ve lined up people to help move over the weekend, a moving truck, taken time off work, etc. The loan officer is refusing to put us up in a hotel or provide any other accomodations despite this being his fault. I would now like to back out of the purchase. I’m aware I will lose my 1000 earnest check, but can the sellers take any other recourse against me?

My name is Stephanie, 952-567-3135.

Asked on May 25, 2016 under Real Estate Law, Minnesota


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

If you back out of the sale, the sellers can not only keep the earnest money but can sue you for *any* additional losses, costs, etc. they incur. For example: say that they spent $1,000 on a lawyer, and have to now hold onto the house for another 4 months until they can close on another sale to someone else, and their monthly carrying cost is $2,000/month (mortgage, taxes, insurance, utilities, etc.). They could in that case recover $9,000 total from you, or $8,000 after keeping the earnest money check.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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