When is it Too Late to Back Out of Buying a House?

 Posted on February 26, 2025 in Real Estate

The formal home-buying process begins when the buyer makes a written offer to buy a house. If the seller accepts your offer as it is written and also signs it, it becomes a binding legal contract. You might hear your real estate agent or Libertyville, IL real estate lawyer refer to the house as being "under contract" at this time. This is normally the point where it is too late to back out of a sale without repercussions. However, you may still be able to back out of the purchase if you have a valid reason.

When you make an offer on a home, you are not blindly agreeing to buy the home no matter what. A properly written offer should list contingencies that would allow you to abandon the purchase. If one of those contingencies arises, you have grounds to refuse to follow through with buying the home. This makes things much more fair for buyers who have not yet had a chance to conduct a thorough inspection or have an attorney carry out the necessary legal research on the property.

Common Contingencies That May Let You Walk Away From a Home Purchase 

A few common contingencies real estate attorneys recommend including in offer letters involve: 

• The condition of the home - You likely walked through the home with a realtor before making an offer. However, these brief tours do not always reveal serious issues with the foundation, plumbing, wiring, or other critical systems. Your offer should contain a clause allowing you to back out of the sale if any major problems that significantly affect the value of the home are identified during your home inspection. 
• Blocked sales - Some municipalities will not allow a homeowner to sell his or her property unless it is brought up to code or until the homeowner complies with local housing regulations.
• Unexpectedly low appraisals - If the house has not been appraised yet, you will want to make sure that you can walk away from the purchase if the house turns out to be worth much less than the amount you offered.
• Your financing - Financing for a home purchase is never guaranteed. You do not want to be locked into a purchase agreement if you will not be able to secure a mortgage. You can also address the possibility that your financial circumstances could change after you make an offer. 
• Title issues - Your attorney may uncover issues with the home’s title long after your offer has been accepted. If, for example, you find out that someone named on the title cannot be reached and has not agreed to the sale, you would have every reason to want to cancel the purchase.

Contact a Libertyville, IL Real Estate Attorney 

Newland & Newland, LLP takes protecting our clients in real estate transactions very seriously. Our dedicated Lake County, IL purchase agreements attorneys will work to ensure that you can walk away from a sale without penalty if there are any unexpected problems. Contact us at 847-549-0000 for a complimentary consultation.