Source: Motley Fool —
At one point, the housing market was so hot and buyers were so desperate to purchase homes that they were willing to go to different extremes to get an offer accepted. Those included making offers without actually seeing homes in person and even waiving the right to home inspections.
These days, buyers are being less spontaneous and more cautious. The housing market has more inventory now, so they can afford to be more choosy. And with mortgage rates rising, buyers need to be careful about not taking on undue expenses in the course of purchasing a home.
In fact, buyers are increasingly backing out of home purchases for various reasons. In July, about 63,000 home purchases were called off, reports Redfin, representing a little more than 16% of homes that went under contract that month.
If you agreed to buy a home, you may be wondering if you’re able to back out of the deal and what the consequences are. The answer? It depends on the reason as well as the contract you signed.
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Re the backing out of a real estate contract, the buyer can back out (cancel) anytime before removing all buyer contingencies, and the buyer doesn’t even have to give a reason for backing out. After backing out, the buyer gets the earnest money back.