When things do not go as expected in a real estate contract, one of the parties may want to get out of the transaction. However, is it possible to cancel/rescind a contract and leave without facing any penalties?
Florida law provides that, under specific circumstances, a buyer or a seller may terminate a real estate contract and get out of the agreement without penalty. In this article, you will discover the rules and timeframe to back out of a Florida real estate contract.
How Long Do You Have to Back out of a Real Estate Contract in Florida? – The Basics
As provided by Florida law, buyers or sellers may cancel or rescind a real estate contract without facing a penalty. However, it is possible only under certain circumstances.
For instance, state law provides a 15-day rescission period to buyers involved in contracts for residential condos (Fla. Sta. §718.503 (1)). Within 15 days, the buyer can review all transaction-related documents and double-check its terms, and then cancel the contract if necessary.
In this context, some people may ask themselves whether there is a buyers’ remorse law in Florida. In fact, state law provides a “cooling off rule” by which consumers are entitled to a three-day rescission period if they sign a contract for services to be rendered continuously in the future.
Also, buyers are entitled to cancel a contract for future services if they can no longer receive the services, or the services are no longer available as they were offered originally.
Nonetheless, the scope of the “cooling-off rule” is limited, as it applies only to home solicitation sales (i.e., “door-to-door sales”). Plus, the scope of this law does not encompass the sales of real estate properties, insurance, securities, or artwork sold at fairs and other public places.
How Long Do You Have to Back out of a Real Estate Contract in Florida? – Contract Rescission
Depending on the case, it may be possible to rescind a real estate contract in Florida. As provided by Florida case law, once a contract rescission occurs, the contract is considered “unmade” under the law.
The first step to determine whether it is possible to rescind a contract is to search for specific provisions within the contract’s provisions. In Florida, several contracts outline the exact cases that will permit the contractual rescission.
A common provision in real estate contracts that may leave room for rescission is “Force Majeure.” Under “Force Majeure,” one of the parties to a contract is not required to satisfy the contract when performance is disrupted, delayed, or prevented by circumstances beyond their control.
Examples of situations that may trigger “Force Majeure” include natural disasters (i.e., hurricanes, floods, fire, earthquakes, etc.), extreme weather, and acts of terrorism. Ultimately, each contract has different provisions, so make sure it is crucial to consult with an expert attorney before using “Force Majeure” as a ground to rescind a contract.
Other situations that may lead a buyer to terminate a contract involve situations where a lender pulls the commitment for a loan at closing, leaving no option for the buyer except to rescind the contract.
Florida case law also provides situations in which a buyer opted to rescind a real estate agreement due to unsolvable title defects, the occurrence of fraud during the transaction or the existence of mistakes affecting the contract.
Do You Want to Back out of a Real Estate Contract in Florida? – Immediately Seek Professional Guidance
Contract rescission is a complex matter, so waste no time with uncertainty. Get expert advice by calling Attorney Romy B. Jurado today at (305) 921-0976 or emailing Romy@juradolawfirm.com to schedule a consultation.