“The Cash Offer Company”
You accepted an offer. You started packing. Maybe you even scheduled the movers. Then out of nowhere the buyer backs out. It’s a gut-punch that far too many Virginia homeowners experience. But what happens next? Are you stuck? Can you keep their deposit? Do you have to start all over?
In this complete 2025 guide, we’ll walk you through what happens when a buyer backs out of a real estate contract in Virginia and more importantly, what you can do next to sell your house without losing time, money, or your mind.
Can a Buyer Legally Back Out of a Home Sale in Virginia?
Yes — under certain conditions. In Virginia, standard purchase agreements often include several “outs” that allow buyers to walk away without penalty. These contingencies are designed to protect the buyer but they can leave sellers frustrated.
Common reasons a buyer may legally back out include:
- Financing contingency not met (loan denied)
- Home inspection reveals serious issues
- Appraisal comes in low
- Title issues or deed problems
- HOA documents contain unacceptable restrictions
If the buyer backs out for a valid reason within their contingency period, they usually get their earnest money deposit back and walk away without legal consequences.
When a Buyer Can’t Back Out Without Penalty
If a buyer tries to cancel the contract after contingencies have been removed or deadlines missed, they may be in breach of contract. In that case, you (as the seller) have rights.
You may be entitled to:
- Keep the buyer’s earnest money deposit
- File a legal claim for specific performance (forcing the sale)
- Sue for damages if you lost another buyer or incurred costs
However, most sellers opt to simply retain the earnest money (if allowed by the contract) and move on to the next buyer — especially if time is critical.
What Happens to the Earnest Money in Virginia?
Earnest money is a good faith deposit the buyer puts down when signing the contract — usually 1–3% of the purchase price.
Here’s how it plays out:
- If the buyer backs out for a valid contingency reason (e.g. bad inspection), they get it back.
- If the buyer is in breach of contract, the seller may be entitled to keep the deposit.
- The title company or attorney typically holds the funds in escrow until the issue is resolved.
Important: Even if the seller is entitled to the deposit, both parties often must sign a release form to disburse it — which can cause further delays.
Can You Sue a Buyer for Backing Out?
Technically yes — but it’s rare. Legal action is time-consuming and expensive. Most sellers don’t want to spend months in court trying to force someone to buy their house.
That said, if you suffered significant financial harm (lost another buyer, bought a new home, moved out, etc.), it may be worth speaking with a real estate attorney to explore options.
Why Buyers Back Out — Even Last-Minute
At The Cash Offer Company, we’ve spoken with dozens of frustrated Virginia homeowners whose buyers canceled just days before closing.
The most common reasons we hear:
- “The lender said their loan wasn’t approved.”
- “They got cold feet after the inspection.”
- “Their home sale fell through and they can’t buy anymore.”
- “The appraisal came in lower than expected.”
- “The buyer ghosted and stopped returning calls.”
Sound familiar? You’re not alone.
What Are Your Options If the Buyer Cancels?
Here’s what you can do:
1. Relist the Property on the MLS
- Return to market and find a new buyer
- May require another 30–60 days to close
- You’ll need to keep the home clean and show-ready
2. Consider Selling to a Cash Buyer
- No agents, fees, or inspections
- No financing or appraisal delays
- Close in as little as 7–10 days
We’ve worked with sellers across Richmond, Chesterfield, Henrico, and beyond who lost a buyer at the last minute and needed a guaranteed backup plan.
Why Homeowners Choose Cash Buyers After a Buyer Backs Out
After going through the emotional rollercoaster of a canceled contract, many sellers don’t want to repeat the process. A cash sale is simpler, faster, and gives you back control.
Benefits of working with The Cash Offer Company:
- No commissions: Save 6% in fees
- No showings or repairs: We buy your house exactly as-is
- No waiting: We close on your timeline — even in 7–10 days
- We’re local: Based in Richmond, we understand Virginia contracts and title laws
Frequently Asked Questions
Can a buyer back out after the inspection?
Yes — if there is an inspection contingency and they are within the timeline stated in the contract.
What happens if they back out the day before closing?
If all contingencies have been removed, you may be entitled to keep the deposit and pursue legal remedies. Talk to your closing attorney.
What if the buyer’s loan is denied?
If they had a financing contingency and acted in good faith, they typically get their deposit back.
What if I need to sell immediately?
Contact The Cash Offer Company for a fast cash offer. We’ll buy your house as-is, no waiting or worrying about another buyer falling through.
Why Work With The Cash Offer Company?
We’re a family-run, local home buyer based in Richmond, VA. We’ve helped homeowners across the region recover from failed sales, appraisals, probate delays, code violations, and more.
Our process is simple, transparent, and pressure-free. If you’re tired of buyers backing out we’re ready to step in and make a real offer that won’t disappear.
Take the Next Step
Did a buyer just back out on your Virginia home sale? Don’t wait. Contact The Cash Offer Company today for a no-obligation cash offer. We’ll help you move forward fast, fair, and stress-free.
Contact Information
The Cash Offer Company
Phone: 804-215-4004
Email: info@thecashoffercompany.com
Website: https://www.thecashoffercompany.com/
Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. For questions about real estate contracts or earnest money disputes, consult a licensed attorney in your area.