Sellers are always anxious to get their property back on the market after it looks like the buyer won’t be closing. So long as the purchase agreement is properly terminated, the property can be relisted. Watch for these issues to be certain that termination is proper. If so, and the Seller terminates by a Unilateral Termination, the Seller can immediately relist. An improper termination could open the Seller to liability.
It is important to understand the differences between a breach of contract, an anticipatory breach of contract and a non-breach of the contract. Here are some common situations.
Often sellers are not ready to move out on the date set for closing and require a Temporary Occupancy Agreement. In a seller’s market, the buyer usually agrees to win the property. The GAR Temporary Occupancy Agreement (TO) offers protections for the buyer against a seller holding over past the agreed occupancy period.
Temporary Occupancy Agreements are generally limited to 60 days.
The reason behind this provision is that most standard deeds to secure debt and standard FNMA and FHLMC requirements provide that the buyer must occupy the property as their principal residence on or before 60 days from the date of closing. However, if the buyer pays cash for the property, the 60 day limit is not relevant. The buyer should consider, in the case of a cash sale, whether a lease would be more appropriate than a Temporary Occupancy Agreement.
The GAR Purchase Agreement includes a detailed representation and agency section that identifies the Brokers and the type of Buyer or Seller representation that exists between Brokers and the parties. One of the reasons for requiring clarity of representation is that notice to a party can be accepted, or cannot be accepted, by the named Broker according to the type of representation that exists.
The Binding Date of a Purchase Agreement confirms acceptance and initiates certain time periods in the PSA. Binding Date issues can derail a contract if the parties are not operating from the same date. This can happen when an incorrect binding date is entered or if no date has been entered
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