Can buyer back out from the deal after escrow is opened? Customarily in Southern California, buyer has 17 days to back out from the deal for the following 3 reasons:

1. Loan Contingency
Buyer cannot secure a loan successfully.

2. Appraisal Contingency
Property does not appraise to the value of the selling price.

3. Inspection Contingency
Buyer is not satisfied with the condition of the property after property inspection.

After the 17-day contingency period expires, if buyer is fully prepared to purchase the house and has no problem on loan, appraisal, or the condition of the house, buyer can proceed to to remove all contingencies.

Once the contingencies are removed, there is a clear and biding contract to purchase the house. Therefore, buyer can not back out from the deal without penalty or legal consequences.

 
Posted by Caroline Chai on 02/20/2010 05:41 AM   Comments (2)   buyers, sellers  
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2 Comments on How Does Contignecy Removal Work?

FEB
20
2010
1,452,722 Points 46 Featured Posts Outside Blog Called Shot Master

I am not clear on mortgage contingency in California. Should they get the mortgage in 17 days? We can remove inspection contingencies and sometimes have to ask for extensions because of septic testing.
6:04am • #1
405,185 Points 15 Featured Posts Localism Sponsor Outside Blog Hit Router Called Shot Master

In Michigan there is only a ten day window and with foreclosures sometimes less. You really have to read addendum's carefully as they overrule our Purchase Agreements.
6:19am • #2


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