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Non-performing buyer refuses to sign escrow cancellation. Can I move forward with new buyer?

We have submitted cancellation of escrow after a non-performing buyer refused to release funds.  The buyer is refusing to sign the cancellation.

We have a back-up offer and would like to move forward with that deal.  Is this possible?
  • May 07 2009 - Los Angeles
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Answers (5)

Had this happen a few years ago in North Carolina, but it was the seller who refused to sign the termination agreement.
I consulted the attorneys at the NC Real Estate Commission and their answer was that it only takes one to cancel a contract. If the buyer cancels, the contract is dead. The only thing in dispute is the earnest money. 
I would call your state RE attorney and check on this. (by the way, the sellers agent and the BIC were both wrong on this issue, they thought both sides needed to sign, so go to the top!).
  • July 07 2009
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It is true, I had that same situation, it was a Reo, the previous buyer had backed out but not agreed to the cancellation of escrow. The other agent oopened escrow with another escrow company (cant do it with the same company) however, the funds and cancelled escrow from previous buyer should be solved before you close escrow.... to avoid other legal issues in the future.

Sticky situation, ... (not an easy situation as first respondend said)
  • July 07 2009
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You can take their deposit out of escrow and talk to the escrow officer to help you with the new buyer.
You can do it no problem.

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  • June 22 2009
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Hi 2250D,

As long as they don't cancel the buyers can't get there funds back. Give them a notice of buyer to perform, and they won't get their money back until they do... However you are in a sticky situation. The last time I had this happen was several years ago, so I would ask your broker. If they don't know ask your board, if they don't know call the C.A.R. legal hotline and ask them what to do (free provided you're a member)...

Hope that helps, and good luck!
  • May 07 2009
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Have you given them a notice to perform already?
  • May 07 2009
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