Backout contingencies for REO offers...

[David Sirmons]

It seems that even if you want to back out of an offer after it's accepted, you may be in for a rude awakening.

Apparently, you need some kind of provision in place in order to have an 'out' if your buyer splits or disappears. (My only concern.)

I've heard several things:

1.) Take a picture - take a photo of a house the day you first make an offer. That way, assuming your offer is accepted, you can have a visual reference to argue that something has 'changed' since the photo, if you need/want to back out.

2.) Stipulate an inspection period - Pointless, because your offer will likely do better if you have no inspection period. They'll give you one anyway. But, a question on this - does the bank-given inspection period allow you a 'backout' time? It seems if you back out, most banks require proof of an inspection/failed inspection, which might cost a couple hundred dollars.

3.) Stipulate financing contingencies - if you state you 'cannot get a loan' they'll want to see with whom you applied and were denied. If you state 'my buyer backed out/disappeared' you'll likely ruin any chance of doing business with them in the future.

It seems that every road has some kind of ugly, stinky roadblock.
I don't like roadblocks. I really don't like ugly stinky ones.

Give me some cool detours, guys! And thanks!!