Question: We moved here from Milwaukee and signed a purchase contract with $20,000 earnest money for a Goodyear home. We had the right to cancel this purchase contract within the 10-day inspection period. We both have jobs in Chandler. Neither of us realized how far the day-to-day commute was from Goodyear to Chandler during rush hour traffic. Therefore, we decided to cancel our purchase contract for the Goodyear home, get our $20,000 earnest money back, and buy a home in Chandler. Although we are still within the 10-day inspection period, our Realtor said that we will lose our $20,000 earnest money deposit. The reason is that we only have the right to cancel the purchase contract during the 10-day inspection period if there is a problem with the Goodyear home itself, such as a leaky roof. Therefore, we cannot cancel the purchase contract for the Goodyear home because of its geographic location. Is our Realtor correct?
Answer: Probably not. A buyer of a home in good faith can cancel the purchase contract during the 10-day inspection period for any reason, e.g., the home doesn’t have a “good” view of Camelback Mountain, the home is too close to a bus stop, or the neighbors say that the house is “haunted by ghosts.”
Note: The buyer can also cancel the purchase contract in good faith if the home is next door to a home that is owned by a member of any ethnic group, because the Fair Housing Act does not apply to an individual buyer of a home.