Q: If my Seller doesn't meet my concessions after the home inspection, can I walk away from buying the house

A: My answer is limited to an analysis of NJ law only. The answer to the question can the Seller sue is yes. The real question question is whether the Seller can win. Anybody can sue anybody, the issue is whether the threat of suit when analyzed from the Buyer's position shows that foregoing the concessions is more or less expense than defending the law suit. The Seller faces the other side of the coin, i.e., does granting the concessions cost more or less than the cost of litigating. A very careful ready of the contract's language concerning the home inspection clause is extremely important since it is the specific 'rules of the game' which describes the right and obligations of both parties. Assuming the seller does decide to file, can the Seller survive an application for Summary Judgement?

There are also economic and family considerations. The deposit should not be disbursed until there is a legal resolution. You may be unable to buy elsewhere while the deposit monies are not available to you, while the Seller is delayed in his plans as the full purchase price will not be on the table and thus not have funds to move elsewhere. While the decision process is in full bloom, real estate prices and mortgage interest rates are not static but constantly changing, how may the parties be affected. You've also asked why the Seller would sue is not a legal issue but one of motivation of the parties psychological make up. The question only asks about filing suit. There are other Alternative Resolution avenues available. I have not addressed those solutions.