Expert: Russel Ray - 9/20/2007

Question
QUESTION: If we have a binding contract with a buyer and they want to back out of the contract with no legidimate reason.  What if we put the home back on the market and sell it for less the the contract price.  Are they entitled to pay the difference in New Jersey and for how long if so.

ANSWER: Hey, Melissa.

In most states once cannot back out of a contract without a legitimate reason. Sometimes the parties will disagree on what a legitimate reason is, and that's when the courts or mediators get involved. There have been many instances where the sellers have gone to court and forced the buyers to buy the property based on the terms of the contract. It's up to you as the seller as to how far you want to pursue the matter with the buyer either by forcing them to buy the home or suing them for the difference. Before you put home back on the market, check with a real estate attorney to make sure that doing so doesn't automatically let them out of the contract.

Good luck.

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QUESTION: THAT DOES NOT ANSWER MY QUESTION.  IS THERE A LAW THAT FORCES THEM TO PAY THE DIFFERENCE OR IS OUR ONLY OPTION TO SUE THEM.

ANSWER: Hey, Melissa.

I don't think shouting by using ALL CAPS is the way to go. Nonetheless, there is no law that specifically forces them to pay the difference. There is contract law, and you have a contract. So you do have at least two options. One is to let them out of the contract and the other is to sue them to force them to abide by the terms of the contract. However, that doesn't necessarily mean that your ONLY two options are to let them out of the contract or to sue them.

Since I'm in California, and am not an attorney, and definitely am not an attorney licensed to practice law in New Jersey, you should take advantage of most attorneys' free 30-minutes of consulting to see what your best options are there in New Jersey.

Since real estate is fairly expensive and there usually are lots of dollars at stake, please, please, please consult with a licensed New Jersey real estate attorney.

Again, good luck.

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QUESTION: Sorry, I was not screaming with all caps.  I always have it on and forgot to shut it off.  Thank you again for your help.  I guess I screwed it going to cost more to hire an attorney to fight it.

thank you for your time
Sincerely
Melissa

Answer
Hey, Melissa.

I was talking to a Realtor at Century 21 today about your situation. If you're using a Realtor with a major brokerage, many times they have attorneys who know how to enforce the contract, or make appropriate overtures, and the cost is simply part of the commission fees that you're paying the Realtor anyway. So check into that.