People have this notion that if the party that bought your house doesn’t close on the closing date, you win a million dollars and they go to jail. That is simply not true. I was recently speaking to a Real Estate lawyer and what came out of my hour long conversation is very interesting.
First off many deals do not close on the date of closing. Typically the mortgage broker or bank do not get the funds transferred in time. This happens a lot. Many lawyers go home at five o’clock, if the they have not received the funds, they will not close and defer to the next day. If its on a weekend, that means Monday. That is why you should never close on a Friday or end of the month. Chances are you are not closing.
So if the deal doesn’t close, there needs to be an adjustment of funds to cover the extra day of mortgage, and that comes from the buyer. So its a percentage, usually not that much, it can range from $50-$250.
The next thing that could occur is damages for the selling party, now I’ve seen up to $1000.00 go to the seller but this is not always the case, in many cases just the adjustments are agreeable.
Now let’s say the deal completely doesn’t close. The next step is that you must put your house back on the market. So after you sell the house again, you must show damages, if you made money, then you will not be rewarded anything. But here’s something that can be awarded. Fees. Real Estate and lawyer and other fees. If your house doesn’t sell, these parties all are eligible for their commission and fees. If you sell the house again, you can use another agent, so you will have to pay them as well. Chances are you will use the same agent and this will not be doubled.
The bottom line is there must be a deficiency in your sale to get any real damages awarded. You might be awarded for other things if you sue but you must also take into account, these people didn’t close, they probably have money issues, and you will need to be able to collect if you actually win, if they money problems already, how will you cash in?