Can we walk away from a real estate contract if the home is in foreclosure?

UPDATED: Dec 4, 2011

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Can we walk away from a real estate contract if the home is in foreclosure?

Asked on December 4, 2011 under Real Estate Law, New Mexico


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Good question. Is the purchase of the home that you are in contract to purchase subject to the seller's lender's approval of your contract by a short sale addendum and the approval has not happened yet? If so, you can cancel your purchase contract most likely.

If you have not waived and contingencies to purchase the home such as home inspection or loan contingency, most likely you can cancel the purchase contract.

If the property went into foreclosure after you went into contract then you can cancel the contract since the foreclosure jeapordizes the purchase. I suggest that you consult with a real estate attorney further on your question.

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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