Is the due diligence fee an obligation of the buyer if they terminate their offer?

Is the due diligence fee an obligation of the buyer if they terminate their offer before they pay it?

For example: A home buyer's real estate offer is accepted and communicated by the seller. 5 minutes after the acceptance, the buyer changes their mind and terminates the offer before paying the fee.

Question: Is the buyer still obligated to pay the due diligence fee? It was only 5 minutes!

The answer: Yes - Based on the standard offer to purchase form 2-T

Not only is the buyer obligated to pay the due diligence fee, but if the Seller terminates the contract because of the buyer’s failure to pay the due diligence, the Seller could be entitled to recover the Due Diligence Fee together with Earnest Money Deposits as well as to recover reasonable attorney fees and court costs.

So if you have your offer accepted, and change your mind and terminate it, in most circumstances it will be best to pay the due diligence before terminating your offer, because you could end up paying a lot more if you don’t.

And of course, don’t make an offer unless you are really confident that you want to go forward with the transaction.

Keep in mind - terms for the Standard Offer To Purchase Form 2-T change over time, so the answer in this example could change if the terms of the standard contract are updated. Always check with a licensed real estate agent for current guidance.