Q: Real Estate Law Question. We are purchasing a home and in contract, a week before closing the property flooded.
The property had flood insurance so the client went through insurance and was told they would be receiving $35,000. we asked our realtor to tell them we want the $35,000 or we wanted out on the property and we received a verbal yes but then they wanted to now only offer $20,000 instead of the $35,000 they receive from insurance. Is this legal? What are we legally able to do?
A: Thanks for your question. Make sure you carefully review the contract to determine if there is a "force majeure" clause which means "an act of God" clause which protects you in the event of a catastrophic event. If there is such a clause it is an escape for you if there was major damage to the property. I'm afraid your remedy may only be to back out of the deal. You must be careful b/c there could now be hidden defects from flooding and insurance companies are not in the habit of overpaying claims.
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