Sellers refund deposit after buyers suffer tragedy

Your buyer was lucky. She had you on the other side of the transaction and you were willing to let her go and deal with her loss. Not everyone has the ability to do that, and buyers and sellers up and down that chain of buys and sells would have spent money on their buys, sells, moves and other plans. Some might be out thousands of dollars.

When you sign a purchase agreement, you are contractually obligated to purchase the home and the seller is contractually obligated to sell you the home. If the buyer doesn’t close on the purchase, the seller has certain remedies under the contract, like keeping the good faith deposit or suing for damages. Likewise, if the seller fails to sell, the buyers have their remedies under the contract and can sue to force the sale.

Sometimes a purchase and sale agreement includes a provision that allows either party to exit the deal should one of the parties die, become incapacitated, lose a job, or relocate to a different city for a new job. These provisions are quite rare in residential real estate agreements, but Sam has run across them once in a while. They are less common in seller markets, where too many buyers are competing for too few homes.

We appreciate the position your buyer was in all those years ago and are sure she’s grateful you were able to let her out of the contract without a financial penalty. Her grief was undoubtedly enough.