There may be times when a seller needs a little more time to finalize the closing of a property sale. In such instances, the buyer might offer flexibility and grant an extension. This is especially true if the reasons for the delay are valid.
However, both parties must agree on such an extension. The seller must also clearly state that the delay is due to reasonable circumstances. Otherwise, they could face a suit due to breach of contract.
Risks to missing the deadline
The closing date is an important milestone. In a real estate transaction, it’s the day when the seller officially transfers property ownership to the buyer. If the seller fails to do so on the agreed-upon date, the contract doesn’t automatically become null and void.
In fact, there are several options available to the buyer:
- Seek financial compensation: If the delay results in unexpected costs to the buyer, such as storage or temporary housing, they can seek compensation for these additional expenses.
- Request for specific performance: If it appears that the seller is intentionally delaying the sale, the buyer has the right to take legal action to ensure the deal goes ahead as agreed.
- Cancel the contract: In some instances, the buyer might opt out of the transaction if the seller fails to meet the closing date.
In the event of a contract cancellation, it’s standard practice for the seller to return the earnest money deposit to the buyer.
Remedies for the delay
Purchase contracts often include clauses that offer solutions for delays—these range from financial penalties to legal actions, such as a lawsuit for specific performance. While a delay in the agreed-upon closing date can lead to various outcomes, it’s important to remember that, as a buyer, you have made a significant investment in this property. So, you have every right to take the necessary steps if you believe the seller is intentionally delaying the sale without a valid reason.
