5 Things to Know About Failed Real Estate Deals
Your House Sale or Property Sale Fell Through? What now? Will I need a Litigation Lawyer?
- Who gets the deposit?
Generally speaking, when a house sale falls through the vendor of the property retains the deposit unless there’s specific wording in the Agreement of Purchase and Sale that states otherwise. That’s true even if the vendor resells the home at the same, or even a higher, price.
- The price of the house dropped after the property sale fell through. Now what?
The vendor can initiate a Claim against the purchaser who failed to close on the original deal and caused the house sale to fall through if there was a binding Agreement of Purchase and Sale. The original purchaser will then be on the hook for the difference between the original contract price and the new price, unless they can demonstrate that the vendor failed to obtain a fair new price.
- My real estate agent assured me that I’d get a mortgage, and I couldn’t get one! Now what?
Negligent advice from your real estate agent can lead to a Claim against the agent for any damages that you suffer as a result, such as if a property sale falls through and causes you financial harm. Make sure to always get all assurances and promises in writing, that will make proving them much easier down the line, if it’s ever necessary.
- The Vendor claimed that the attic/basement is grandfathered in. The City now says I have to make significant renovations!
The first thing to do is to contact your Title Insurance provider. If you didn’t get Title Insurance (which is never a good idea!), then consider whether the vendor made false statements in either their listing or other documents. Claims against vendors are notoriously difficult, as the Agreement of Purchase and Sale (“APS”) usually states that despite any previous representations there are no representations being made other than those expressly stated in the APS. So make sure all those promises are added to the APS.
- The vendor said that there were no issues with the property, and now there’s a big leak in the basement! Now what?
Vendors have a duty to disclose “latent defects” to potential purchasers. If they failed to disclose such defects, they may be liable to the purchasers for the costs of remedying the problem.
Contact us today for assistance with any of the above issues, we’ll be glad to provide a free telephone consultation.