When real estate changes hands, it goes without saying that there will be a contract in place. This contract is created to protect both parties throughout the process.
While most transactions go off without hitch, there are times when trouble arises. If you’re dealing with a breach of a real estate contract, such as if the other party is no longer willing to fulfill their contractual obligations, you need to understand your legal rights.
There are a variety of remedies for breach of contract, many of which will require you to take legal action.
- Seeking compensatory damages is the most common financial remedy. In short, when these claims are successful, the person who breached the contract is ordered by the court to pay the other person enough money to get what they expected through other means.
- Seeking restitution for your investment is also common. This is when the court requires the breaching party to pay back the other party.
- In some cases, you may have a right to punitive damages. It doesn’t typically come into play, but it’s a possibility. Punitive damage compensation is paid by the breaching party when a morally reprehensible event occurred.
- There may also be language regarding liquidated damages in your initial contract. This outlines the damages the individuals agree to pay in the event of a contract breach.
It goes without saying that you never want to find yourself dealing with the breach of a real estate contract. Unfortunately, you never know what the other person will do as your transaction moves forward and inches closer to closing.
If you find yourself in this situation, you should read your contract in great detail. From there, you can make a final decision as to which steps to take to receive the compensation you deserve.
Source: FindLaw, “What Is the Most Common Legal Remedy for a Breach of Contract?,” accessed Jan. 24, 2018