Penalty for a Seller That Doesn't Sell the Buyer the House by the Contract Deadline

In real estate, sellers and buyers have obligations to each other.


There are two parties to a real estate sale: a buyer and a seller. Once a buyer and a seller of real estate formally agree to a transaction, they have certain legal obligations to each other. Problems arise when parties to a real estate transaction don't want to fulfill their legal obligations. For example, when a home seller fails to sell her home to the buyer by the agreed-upon date, she can face penalties.

Seller Obligations

A real estate purchase agreement signed by a buyer and a seller creates a binding contract. Sellers agreeing to sell their homes to buyers generally must complete the sale by the agreed-upon date. If the seller can't meet the sale completion date of his home, for example, it creates problems for the buyer. For a property seller failing to meet the sale date, a daily monetary penalty may result.

Buyer Remedies

A buyer is entitled to redress when a property seller can't complete the sale of his property. For one, a buyer may seek breach-of-contract money damages when a property seller fails to complete the sale. For another, a property seller failing to complete a sale must return all deposits, plus added reasonable expenses, to the buyer. Lastly, a property buyer may seek to compel the seller to sell the property under specific performance.

Specific Performance

In real estate, specific performance is where the buyer wants to complete the sale under the terms agreed to by the seller. A buyer that wants to compel a recalcitrant seller to sell his property under already agreed-upon terms can ask a court to order such a sale. However, a court has sole discretion to order a real estate sale through specific performance. In all cases, specific performance in real estate must be appropriate to the particular sale.

Purchase Agreements

Real estate purchase agreements contain the terms and conditions that obligate buyers and sellers. If you're a property buyer and the seller refuses to honor the terms of the purchase agreement, consult an attorney. Property sellers refusing to honor signed purchase agreements often are liable for reasonable buyer's attorney fees. Lastly, go over your real estate purchase agreement carefully and make sure it addresses the seller's performance responsibilities specifically before signing it.

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