Seller Backing Out - Could Lose Disability Benefits?

[William Martin]

I'm currently working on our 4th rental purchase and everything has been going fine.  Closing is in 6 days and all is in order and ready.

However, today I received notice that the seller is wanting to back out because the house is subsidized and selling could cause them to lose disability benefits that they have.

I'm a little surprised that they didn't know this in advance.  I'm in Houston, TX, and the contract is a typical TREC contract.  I think I know my options for recourse, but would appreciate any information regarding:

• if and how the deal might be saved, and
• what types of scenarios create this issue so that I can watch for them in advance going forward.

Thank you in advance for your replies!

William