Reasons for terminating a purchase and sale contract

01. Due Diligence – Did you know that in Georgia during the Due Diligence Period, you can terminate the contract for any reason?⁠ Yep!! During this period, it is critical that you do the home inspection, negotiate any repairs, research your neighborhood, schools, commute times, and anything else that you need to ensure that you are 100% comfortable moving forward with the purchase of your soon-to-be home.⁠ If you decide that you are not comfortable with something you find in the inspection, or that you don’t like the tile in the bathroom, you can terminate the contract and keep your earnest money.

02. Appraisal Contingency – ⁠This contingency allows you to terminate the contract if the home does not appraise. Most buyers will take the low appraisal to the seller and ask if they would lower the purchase price down to the appraised value. If the sellers do not agree, buyers can terminate and take their earnest money. 

You and your Realtor will need to submit a Termination and Release Agreement BEFORE the end of the Due Diligence Period or any agreed upon contingency.⁠

03. Financing Contingency – This contingency allows the buyer the chance to obtain final loan approval. If the buyer can not obtain loan approval within the financing contingency, the lender will write a loan denial letter and buyer can terminate and walk away with their earnest money. 

And if you get to a place where you *do* need to terminate your Purchase & Sale Agreement? You and your Realtor will need to submit a Termination and Release Agreement BEFORE the end of the Due Diligence Period or any agreed upon contingency.⁠
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The seller will ALSO need to sign the agreement in order to receive a full refund of your Earnest Money!

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