Can I Terminate a MN Real Estate Purchase Contract I’ve Already Signed?
We occasionally get asked by buyers (and sellers) if they can terminate a real estate contract they’ve signed due to a life change, change of heart, anxiety, or simply because they think they found a different house they like better.
First, always consult your attorney for legal advice specific to your situation.
Typically once a contract has been executed there is an inspection period, often five to ten days. During this time the inspection will occur. In most contracts, there is a clause where if the buyer is unhappy with something in the inspection report they can get out of the contract and get their earnest money refunded to them.
The buyer’s Realtor will then create a cancellation form which the buyers and sellers sign asking for a refund of the earnest money. All of this has to happen before the end of the inspection period. Once the period has ended, it is very difficult, if not impossible, for the buyer to get out of an executed contract for the purchase of a home.
Other ways a buyer may get out of a real estate contract:
If the contract was also contingent on association review, you may have the opportunity to get your earnest money back and cancel the contract if you are unhappy with the association.
If the contract was also contingent on the sale of another property, you may have the opportunity to get your earnest money back and cancel the contract if that sale doesn’t happen.
If the contract was also contingent on the appraisal of the property, you may have the opportunity to get your earnest money back and cancel the contract if the appraisal is lower than the sale price and a sale price agreement cannot be reached.
Ways a seller may get out of a real estate contract:
Virtually none unless your agent writes in clauses or the buyer defaults!