Q: Georgia Termination and Release form – why should I sign it?
A: Sometimes, despite everyone's best effort and how hard we've worked together to buy or sell your Atlanta home, we do not get to the final and necessary meeting of minds that would move the transaction forward. The contract terminates instead of closing, and we are naturally disappointed. When this happens, it is imperative that all parties be formally released from the terms of the contract.
In Georgia the Termination and Release form or Notice of Withdrawal and Termination should be be completed and signed by both the buyer and seller as soon as all parties agree that the contract is terminated. This is very important for everyone:
- The buyer needs it in order to get the earnest money deposit released from escrow.
- The seller needs it in order to offer the property to the next buyer.
- The agents and their brokers require it to close out their files.
The Georgia Termination and Release or notice to Withdraw or Terminate is usually a brief, one-page document and easy to complete:
Whichever party is initiating the Termination and Release must fully complete section 1, stating the reason for the termination.
If there is earnest money to be disbursed, BOTH parties MUST sign section 2.
*Note - there is just one section in the Notice to Withdraw or Release
If a T and R (as we usually call both forms) is sent to the other party prior to the end of the Due Diligence period, or Financing Contingency or some other contingency that refers to earnest money disbursement, AND the party terminating is NOT in default in some way, then the earnest money disbursement should not be an issue.
But issues can arise when negotiations stall and don't end well. All parties do not come to that necessary "meeting of the minds". And sometimes raw feelings can get in the way of business. Participants want to move on, sometimes neglecting this last important step to canceling out the contract.
Be aware from the outset that in Georgia a Termination and Release or Notice to Withdraw and Release is necessary to cleanly terminate your contract.