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Am I bound to a property sale if the buyer signed as an LLC?

Am I bound to a property sale if the buyer signed as an LLC?

Q: Can a seller back out after signing a purchase agreement?

A seller can back out after signing a purchase agreement, but doing so may lead to legal consequences. If the seller withdraws without a valid reason as specified in the contract, they could face a lawsuit for breach of contract. It is crucial for sellers to understand their rights and obligations before attempting to back out.

Full question:

I signed a property purchase agreement as seller. The buyer had not signed at the time. When he signed, instead of signing his name as expected, he signed a company LLC name. I objected, as I never intended or agreed to sell this property to a company. In fact the realtor described the buyer's intentions as 'to build a home for his family'. Now the buyer and realtor insist I'm legally bound to this document. How can this be?

Category: Contracts
Date: 04/07/2025
State: Minnesota

Answer:

Some buyers use LLCs for their transactions, which may be the case here. The buyer's intent to build a family home could still align with this approach. If you feel misled, particularly if the buyer or realtor made false statements to induce you into the sale, this could potentially void the contract. You can refuse to proceed with the sale based on that misrepresentation, but be cautious, as they may threaten legal action. The legality of your situation depends on the specific facts and what is stated in the contract. If you choose to contest their claims, consult a lawyer immediately, especially if they indicate they will sue you.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

What happens when a buyer breaches a real estate contract?

When a buyer breaches a real estate contract, the seller may have several options. They can seek damages for any financial losses incurred due to the breach. Alternatively, the seller might choose to enforce the contract and compel the buyer to complete the sale. In some cases, the seller may also be able to terminate the contract and keep any earnest money deposit. The specific remedies available depend on the terms of the contract and state law.

Can a buyer change their mind after signing a contract?

Generally, once a buyer signs a real estate contract, they cannot simply change their mind without consequences. However, some contracts may include specific contingencies that allow the buyer to back out under certain conditions, such as financing or inspection issues. If there are no contingencies, the buyer may face legal repercussions for attempting to withdraw from the agreement.

Can a buyer pull out after signing contracts?

A buyer may pull out after signing a contract, but it typically depends on the terms of the agreement. If the contract includes contingencies that allow for withdrawal, the buyer can do so without penalty. If there are no such provisions, the seller may pursue legal action for breach of contract, and the buyer could lose any earnest money deposited.

Can a buyer change their mind after signing a contract?

Once a buyer signs a contract, they usually cannot change their mind without facing potential legal consequences. If the contract does not have contingencies allowing for withdrawal, the seller may hold the buyer accountable for fulfilling the terms of the agreement. It’s important for buyers to fully understand their obligations before signing.

Is a signed purchase agreement legally binding?

Yes, a signed purchase agreement is generally considered legally binding. Once both parties sign, they are obligated to adhere to the terms outlined in the contract. However, if there are misrepresentations or if the agreement lacks essential elements, it may be possible to contest its validity. Always consult a legal professional for specific advice.