A Complete Guide to If and When You Can Back Away From Buying a House

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Despite its excitement, the actual process of buying a home can feel rather daunting. You might get halfway through and find yourself facing changes, obstacles, or concerns that make you consider backing away from your purchase. 

That’s why it’s important to educate yourself on the home buying process before you begin. In addition to learning the ropes on how to buy a home, don’t forget to learn more about how to not buy a home. What reasons allow you to back away from a deal, and when does it become too late? Here’s what you need to know. 

The Best Time to Back Out is Before Your Offer is Accepted

You find a house you love and put in an offer, but then have a chance of heart. You can withdraw your offer and walk away without any complications. 

If the seller makes a counteroffer, you aren’t obligated to accept it. You can back away from the deal at any time. On the flip side, if you wait until after your offer is accepted and you sign a purchase agreement, your offer becomes legally binding, and walking away becomes far more difficult. 

Check the Terms of Your Contract

Once you sign a purchase contract or agreement, you can only back away from buying the property for the contingencies stipulated in the contract. Be sure to negotiate for these contingencies so that you are protected in all situations. 

Just keep in mind that most common contingencies have a deadline, so you must act promptly if you encounter any of the following:

  • Serious problems with the home inspection
  • A low appraisal
  • Your current home won’t sell
  • Your financial situation changes, and you no longer qualify for a mortgage
  • The title search uncovers a dispute or conflict

Back Out and Pay a Penalty

If you’ve already signed a contract and can’t use a contingency to justify walking away from buying the home, your only choice is to pay a steep cost to back out. Buyers who need to abandon a home purchase in this situation lose their earnest money deposit, which is usually between 1% and 3% of the total purchase price.

When all else fails, turn to a professional team for support. Benefit Title Service, LLC helps homeowners and homebuyers with all of their concerns. Call Benefit Title today at (813) 251-1420 to learn more about navigating the complex home buying process.