Contract expires. What would you do.

[Eddie Ziv]

I was suppose to close on that deal July 10. I'm buying a REO SFR all cash deal. The original contract called for June 24 to close. Then the seller asked to make it July 10. I agreed, signed the contract and put $1,000 cashier check as earnest money. On July 10 the sellers (The Bank) notified me that they cannot meat the deadline and asked for one week extention. We signed the extension. On Friday (7/17) the sellers notified my agent that they are having a problem with the title which aparently wasn't recorded properly. Now they want another two weeks extension.

So, what would you do?
1. Just give them the extension.
2. Give them an extension but demand price reduction, lets say 10%
3. Back off the deal all together,
4. Any other idea