[gcruse]

Until closing, when the papers are signed, neither of you are under any legal obligation to do anything, except for any earnest money you put up. Had you pulled out, you might have lost your earnest money.

[patent]

>>>>Until closing, when the papers are signed, neither of you are under any legal obligation to do anything, except for any earnest money you put up.

You are not correct here.

There are typically three steps to a real estate transaction.

First, the offer and acceptance. Once accepted, you have a contract that obligates both parties, subject to the inspection. Reality: its easy to walk away as the contract is easily voided by inspection

Second, inspection over and purchase contract signed. You have legal rights to the property, and they have legal rights to your money.

Three: closing. You now own property in your name, and they have your money.

They are obligated to perform, certainly at the second step, and well before closing. You can't just walk away willy nilly.

patent

[JoeFromCA]

"Until closing, when the papers are signed, neither of you are under any legal obligation to do anything, except for any earnest money you put up."

This statement is incorrect. In essentially every state only the buyer can walk away loosing only the "earnest money." Having entered into a contract for sale, the seller is obligated to sell and cannot walk away from the deal. Money damages are inadequate to compensate for the purchase of a unique item such as real property; the seller is compelled to perform (called specific performance).

Lots of commentators here who've never been to law school.

[TheConservator]

I am glad you are not my lawyer, because you are dead wrong!

[wardaddy]

yep...the seller will have to return the earnest money and anything beyond that will be up to the precise contract wording and redress will be costly to obtain.

I would never put myself at risk for more than earnest money in my real estate contracts...and I always have an easy out as a buyer in a contract up until closing time expiration. As a seller, it's a bit harder but I can't recall anyone being forced to sell commerically if they pulled out and I have even seen plenty of earnest money sued for when kept by greedy sellers and returned to the buyer even if the buyer let closing time expire.

I would not keep a buyer's earnest money typically. It creates for bad blood and word gets around quick and your future dealings will then get juiced up with legal fees everytime you fool with someone. But it depends on the individual deal. This poor fellow needs to get his earnest money back and move on is my guess.