Every now and then, I have a client ask me (usually mere days before closing) what will happen if they refuse to close.
Generally, it is not a good idea to refuse to close once your deal is firm. A firm offer is a binding contract, and the consequences of breaking the contract have the potential to be severe. If the other side has put any money into getting ready to close, then you can end up being responsible for those costs. This is of particular concern if you are buying a property, and the sellers have bought a new property – you may be on the hook for more than just sellers’ costs related to their own home because there are costs for the people selling to your sellers, and further on down the chain. If you are selling and you refuse to close, you may run into trouble if the buyers don’t have anywhere to go because they are selling a house.
If you aren’t sure about selling or buying, the best time to make that decision is before you have a firm offer. If you are ready to be firm on your offer, you should be prepared to close the deal.
