Excerpt from:  SnowHome Properties
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February 15, 2005

Selling Safely

What's a "kick out" clause and how does it work?

There is nothing worse for a seller than to have your property under contract, have all your plans made, and everything packed, only to have the buyer fail to meet their obligations and be unable to close the deal. There are so many things to consider.  Even an apparently well-qualified buyer can have something appear on their credit report that can squirrel the deal - if there just isn't time to correct it. 

One of the contingencies that are being seen more often, however, is the buyer's need to sell their current home in order to buy yours.  In fact, many sellers will not even take an offer with such a contingency.  But, a well-crafted clause in the contract can protect both buyer and seller, and in many markets, it may be more important to get the property under contract than lose an otherwise qualified buyer. 

If you are selling a SnowHome in Summit County, this can be an expected occurrence.

The way to do it is with a kick-out clause.  With this clause, you can continue to market your home, and if you get another qualified buyer with whom you can come to terms, the first buyer has to either prove they can buy without the contingency or terminate their contract.  There are never any guarantees, but this can take so much of the mystery out of the process. 

Be sure to consult with your Realtor about this when the time comes.

by Ken Deshaies
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