Inspections went well, the buyer’s financing is coming into place and the parties eagerly agree to move the closing date up. Before executing an addendum to do so, it is important for the buyer to take a few things into consideration.
First, consider whether an addendum is necessary. The parties can agree to close on a date prior to the contract closing date.
If an addendum is executed for an earlier closing date and the date is then unable to be met, the buyer can now be held in breach of contract with both the closing and their deposit at risk. Once an addendum is executed altering the closing date, the initial contract close date becomes null and void. If the seller is unwilling to again alter the closing date, then the seller does have the legal right to enforce the new “earlier” closing date while the buyer has no power to enforce the previous closing date.
Always carefully consider the risk before allowing your buyer to sign an addendum moving up their closing date. If the parties are unable to agree to move the closing date up without an addendum and there is any doubt that the new date can be met, it is prudent to wait until closer to closing before making such a decision to minimize the risk to the buyer. It is of course possible that the seller, given a later request to move up the closing date will refuse the idea. However, the risk of the disappointment of having to wait a few extra days or weeks to move into the buyer’s new home is potentially a smaller price to pay than the risk of losing the home altogether along with the buyer’s security deposit. Thus, we urge the parties to consider all potential risks before making a decision changing the current contract terms.
If you need assistance in determining or weighing the risk of altering a contract, or have any questions about the foregoing, we urge you to contact your local real estate attorney.
Berlin Patten Ebling, PLLC
Article Authored by Jessica Featherstone, Esq. firstname.lastname@example.org
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