#RealEstate #Rent, #Safety, #Hawaii, #Laws, #Investor, #Real Estate, #News, #Tips, www.Hawaii.Bio

Generally, a real estate transaction is expected to proceed in accordance with the terms and conditions set out in the “four corners” of the purchase and sale agreement. The expectations of the buyer and seller are clearly set according to the time limits set in the contract. Generally speaking, everything goes like this; the buyer views the property, there is an offer and acceptance, followed by loan approval, termite inspection, survey and final walk through, signing and finally recording.

Outside of the contract, the buyer may want the seller to clarify the answers associated with the disclosure statement. They may also request repairs after inspection. Remember that sellers are under no obligation to make repairs or renegotiate at any time. A dissatisfied buyer can cancel without penalty if he does so within the contractual time frame. Otherwise, the buyer is expected to act in accordance with the terms of the contract. Buyers typically believe (though perhaps mistakenly) that no penalties other than possible forfeiture of the original deposit will be imposed, even for default immediately before closing.

Change of mind?

Imagine that the buyer has credit approval or, even stronger, pays cash. The seller relies on this commitment and begins the closing process. One owner closed his business and moved to the mainland after Buyer received loan approval. Termite inspections and surveys are ordered. Tenants are notified, houses are fumigated, household goods are packaged/sold, and perhaps the Seller moves forward with another purchase. Van moves are arranged, temporary cleaning services are hired, etc. The buyer and seller sign all closing documents and the record is set. The buyer suddenly changed his mind. They start making new demands or, worse, they want to cancel the purchase. Even the forfeiture of a healthy, serious cash deposit can leave a seller with a huge deficit, not to mention completely turn the seller’s world upside down.

Breach of contract

Of course, in today’s market, most sellers rely heavily on promises made and contractual obligations. Defaulting buyers are advised to consult with their attorney, who will likely explain that the seller may have other remedies, including compensation for costs and damages resulting from the buyer’s breach of contract. Even with a valid reason for last-minute cancellation, the most compassionate sellers may be unwilling or unable to refuse compensation for broken contractual obligations at the last minute. The bottom line is this: Buyers best beware of breaking their promises on a property at the last minute!