Revocation
Revocation comes from the verb "to revoke", which means to take back the validity of something. The definition of revocation is detrimental to contract law. It gives the person making the offer the right to take back the offer at any time before the other party has accepted the offer. In case the buyer, the one making the offer, allows the seller a prolonged period of time to decide upon the offer, the seller must be aware of the meaning of revocation. At any given time, the buyer, the offerer, can take the offer off the table.
Revocation in real estate is only blocked by the acceptance of the offer and, very important, the communication of the acceptance. If the seller communicates the acceptance of the offer or offers a counter-offer, then the revocation can not go into effect, and a binding agreement stands between the two parties. This agreement can only be affected by the conditions that already exist in the offer.
Revocation in real estate
A real estate agent or REALTOR® has two fundamental obligations to their clients besides the trust shared between a real estate agent and their client: to obey the client’s lawful instructions and the duty of care. These two principles of a real estate professional’s life affect the revocation of an offer or a counter-offer. When the buyer informs the real estate agent that they want to withdraw their offer, the real estate agent must follow the instruction at once.
In real estate, revocation is a term applied in a few different situations:
- When a person or a business making an offer decides to nullify that decision before it is accepted.
- For the act of canceling the authority given to another, such as when a homeowner takes away the right of a real estate agent to represent him.
- When terminating a financial instrument before issuance.
Example of revocation in real estate
The buyer, Sam, wants to revoke the offer made to purchase the property. Sam informs the real estate agent of his decision to withdraw the offer, and they prepare a letter that stipulates the proposal and clearly states the revocation. Sam signs and dates the letter with witnesses. The real estate agent then gets in touch with the other party’s real estate agent to communicate the need to deliver a revocation. Once given the revocation, it goes into effect.
Example of acceptance before revocation
If the seller’s real estate agent receives Sam’s revocation after the seller accepted the offer, then the revocation becomes a breach of contract. The party that was hurt, in this case, the seller, can keep the deposit and also sue the buyer for additional costs and damages.
Real Estate Tips:
Revocation guidelines and eligibility vary from state to state, so do not forget to contact a local real estate agent to help you understand the specifics of your real estate market!
Popular Real Estate Terms
Fence constructed at the property line or other division point separating a subdivision or a home site. It marks the point of separation between two separate properties. ...
Voluntary giving up of a right of a lien, usually on a temporary basis. The waiver may be explicitly stated or implied. An example is when a lender waives its right of lien against ...
Financial interest a developer has in a development. The interest may be a direct investment or a percentage interest in the overall profit. ...
Factor used in present value computations to determine the current value of future cash flows. It is used to get the current value of what the selling price would be when the property is ...
Large heavy piece of wood or other material generally running horizontally through a building providing support for other parts of the structure. The stringer usually runs in the direction ...
Same as term government rectangular survey: Way in which the U.S. government uses to subdivide public land. Land is designated as either a base line (East-West) or principal meridian line ...
Lease that incorporates increases in agreed-on payments over the term of the lease contract. For example, a particular step-up lease may require that the lessee pay a 10% increase each year ...
Steps taken to remove someone from the real property who does not have a contractual basis to be there. An example is the landlord removing homeless people who have moved into a vacant ...
Affordability is a term used to describe the ability of a person or entity to pay in relation to the income earned by them. Affordability is the comparison of a person's income against ...
Comments for Revocation
How many days does a buyer have after accepting an offer to revoke the offer using the disclosures as the reason?
May 18, 2018 14:09:48Hey, Lexi
May 25, 2018 08:59:39Usually 3 days before the closing date, but you'd have to check your state's regulations; better find a local real estate agent to help you out on this one, because in some cases you can't just "give up"; the home seller has the ability to prove his disclosure was right etc. So, please, feel free to search through our real estate agent directory (it's 100% free) and contact one to help you with this situation!
Have a question or comment?
We're here to help.