missing the closing date would prompt the seller to take legal action against you. After all, the sales transaction is a legally binding contract. The seller or homeowner may take the case to court to be compensated for monetary damages such as continued payment on the mortgage and insur- ance. Alarmingly, there have been cases wherein the seller can sue you directly forcing you to buy the home. This is regardless of whether you weren’t approved for loan financing or if you simply want to back out of the deal. VIOLATING THE “TIME IS OFTHE ESSENCE” CLAUSE The Time is of the Essence Clause (TOE) is a term in the contract that specifies a certain time or date is of utmost importance. It basically states that “the times and dates in this agreement are vital and mandatory to the contract.” This places the deadline in writing. Any unforeseen circumstances that may arise such as not being approved for financing are basically irrelevant once the closing date has passed. Non-compliance of this clause causes the real es- tate contract to be null and void. Since this is stated in the contract, refusal to follow through makes you face an injunction, which is a court order instructing you to fulfill the contract as it should be. THE SELLERWALKS OUT OFTHE DEAL There’s nothing much you can do when the seller cancels the deal. It’s not usually in their best interest to do so since they’d have to start the selling process from scratch, but there is a high possibility for them to cancel when they receive a better offer, negotia- tions went out of hand, or simply because their buyer isn’t compliant with the closing date. A seller legally can’t just walk out of the deal al- together. If you have a good reason for the delay, the court might rule in your favor allowing a reasonable postponement. Once approved, an additional 30-day extension may be given for you to close on the sale. These penalties are surely detrimental for all parties involved; all because of a delay in the closing process. To help you to successfully navigate through the stages of buying the house and meet the deadline without fail, you need to work with real estate profes- sionals with proven track records. •
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