When the Deal Goes Bad

Default, Breach and Remedies in a Residential Transaction

By Brad Boyd, esq
Thomsen & Nybeck, P.A.
3300 Edinborough Way, Suite 600
Edina MN 55435-5962
Internet: www.tn-law.com

As we are all well aware, even after a buyer offers to buy a home, the seller accepts the offer, and various contingencies are removed, there are still times when one of the parties is unable or unwilling to close. This article focuses on default or breach of the agreement by one of the parties.

Both buyers and sellers can breach a purchase agreement; buyers can fail to perform or be unable or unwilling to purchase, and sellers could be unable to deliver good title or may breach an agreement because they no longer wish to sell. In either event, What Happens Next? Generally, depending upon the facts that gave rise to the breach, the non-breaching party will want to evaluate available remedies, including: an agreed cancellation, statutory cancellation, or a legal action (arbitration or lawsuit) to pursue damages.

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Finding Buyers to purchase properties

Our national market correction was inevitable and predicted. Homes have been appreciating at rates that were not sustainable over the long haul. Low mortgage rates and incredibly generous qualifying ratios have turned many renters into homeowners earlier than they would normally purchased. Just like all good things, this one is coming (we still have a little ways to go) to an end.

Does that mean nobody will be buying or selling homes? NO. It means homes will not appreciate at the rate they have for the past 4-6 years. It also means that the marketplace needs to re-balance and rid itself of excess inventories. It means mortgage companies will need to tighten up qualifying ratios in order to shore-up their lending portfolios. In the short-term, that means a price leveling with many areas seeing home values fall back from an all time high last year. It means a lack of 1st time buyers as those who have not purchased either increase their wages, correct credit issues, save for a downpayment or all three. After that, we'll see a more balanced inventory with more sustainable appreciation rates.

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The Minnesota Association of REALTORS® is pleased to announce that we have reached a collaborative agreement with the Minnesota-based online magazine LakeshoreDreams.com, LLC.

As an online magazine they feature articles and resources for those seeking to purchase lakeshore or recreational properties. In addition to interesting and useful articles written by their own staff and lake-oriented magazine partners, LakeshoreDreams.com heavily markets their web site. Their marketing efforts include fifteen professional billboards on major Minnesota highways as well as a significant print marketing campaign in newspapers and magazines of interest to lakeshore property buyers and owners. In the end, there are numerous reasons for potential property buyers to continue visiting over and over again. The visitor base of LakeshoreDreams.com is significant and continues to grow at a rapid pace.

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