A “Sample Letter To Seller Ending Escrow After Inspection” is a formal notice. It tells a seller you’re backing out of a real estate deal. This usually happens after a home inspection reveals problems. Buyers use it to cancel the purchase agreement.
Need to write such a letter? Don’t worry. We’ve got you covered. This article provides templates.
We offer samples to make your life easier. Use our letters as a starting point. Customize them to fit your situation.
Sample Letter To Seller Ending Escrow After Inspection
**Sample Letter To Seller Ending Escrow After Inspection**
[Date]
[Seller’s Name]
[Seller’s Address]
**Subject: Termination of Escrow – Property Located at [Property Address]**
Dear [Seller’s Name],
This letter serves as formal notification that [Buyer’s Name], the buyer, is terminating the escrow agreement for the purchase of the property located at [Property Address]. This decision is based on the results of the property inspection conducted on [Date of Inspection].
The inspection revealed [ Briefly state the significant issues discovered during the inspection. Be specific but concise. For example: “significant structural issues” or “extensive water damage” or “non-functional HVAC system”].
Due to these findings, the buyer is exercising their right to terminate the purchase agreement as outlined in [Specify the relevant clause in the purchase agreement, e.g., “Section 10, Paragraph C”].
Please consider this letter as the buyer’s official notice of termination. We request that you promptly instruct the escrow company, [Escrow Company Name], to release the buyer’s earnest money deposit in full.
We appreciate your time and consideration in this matter.
Sincerely,
[Your Name/Buyer’s Name]
[Your Contact Information]
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How to Write Letter To Seller Ending Escrow After Inspection
Subject Line: Concisely Conveying Your Intent
- Begin with clarity. A subject line like “Termination of Escrow – [Property Address]” leaves no room for misinterpretation.
- Be direct. Avoid ambiguity or overly polite phrasing. The seller needs to immediately understand the letter’s purpose.
Salutation: Maintaining Professional Decorum
- Address the seller respectfully. “Dear [Seller’s Name],” is a standard and appropriate opening.
- If you’re unaware of the seller’s name, use “Dear Seller,”. However, this should be a last resort.
Introductory Paragraph: Setting the Stage
- Reference the purchase agreement date and property address. This anchors the letter to a specific transaction.
- State your intent unequivocally. “This letter serves to formally notify you of my/our decision to terminate the escrow agreement”.
- Avoid lengthy preambles. Get straight to the point.
Body Paragraphs: Articulating the Rationale
- Cite the specific inspection contingency within the purchase agreement that allows for termination.
- Briefly allude to the unsatisfactory findings discovered during the inspection without excessive detail. For example, “The inspection revealed significant discrepancies that render the property unsuitable for purchase under the agreed-upon terms.”
- Avoid accusatory language. Maintain a neutral tone, focusing on the property’s condition rather than assigning blame.
- If applicable, mention efforts to negotiate repairs or credits, and explain why these attempts proved unfruitful.
Disbursement of Earnest Money: Addressing Funds
- Clearly state your expectation regarding the return of your earnest money deposit. “I/We expect the full earnest money deposit to be promptly returned as stipulated in the purchase agreement.”
- Reference the relevant clause in the agreement that mandates the return of funds upon termination within the inspection period.
Closing: A Formal Farewell
- Employ a professional closing. “Sincerely,” or “Respectfully,” are fitting choices.
- Avoid overly friendly or casual closings.
Signature: Solidifying Your Decision
- Include your printed name below your signature. This provides clarity and avoids any ambiguity.
- If there are multiple buyers, ensure all buyers sign the letter.
- Retain a copy of the signed letter for your records.
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Frequently Asked Questions: Ending Escrow After Inspection
This section addresses common inquiries regarding the process of terminating an escrow agreement following a property inspection. It will provide clarity on the procedures and potential implications involved.
What constitutes a valid reason to end escrow after an inspection?
Significant undisclosed property defects discovered during the inspection, which impact the property’s value or habitability, typically constitute valid reasons.
What should be included in the letter to the seller ending escrow?
The letter should clearly state the intent to terminate the agreement, reference the purchase agreement date, specify the inspection contingency, and detail the unacceptable findings.
Will I receive my earnest money deposit back?
Typically, yes, if the termination is based on a valid inspection contingency as outlined in the purchase agreement. Review your agreement for specific terms.
What happens if the seller refuses to release my earnest money?
Disputes regarding earnest money can often be resolved through mediation or small claims court. Consult with a real estate attorney for guidance.
Is there a deadline to end escrow after the inspection?
Yes, the purchase agreement usually specifies a timeframe for completing the inspection and notifying the seller of any issues or the intent to terminate. Adhere to this deadline.