Defaulting Buyers lose their deposit

Defaulting Buyers lose their deposit – even in a rising market

One of the fundamental principles of contract law is that damages are based on the actual loss suffered by the innocent party when there is a breach of contract. Damages restore the innocent party to the position she would have been in if the contract had been fulfilled. However, she is required to seek alternatives to mitigate her loss. If there is no actual loss, because the innocent party can re-contract at the same or a better price, no damages are awarded. The traditional exception to this rule has been in real estate deals, where a purchaser who backs out loses his deposit regardless.

Read more…

rlp-sj-large4