How Perry Homes Uses This Clause
Perry Homes purchase agreements have been documented to include deposit forfeiture provisions. The contract may allow the builder to retain the buyer's earnest money deposit if the buyer cancels for reasons not explicitly covered by the agreement.
Earnest money deposits in new construction can be substantial, and forfeiture clauses create a financial penalty for cancellation that may discourage buyers from exercising their rights even when legitimate concerns arise during the construction process.
Perry Homes operates exclusively in Texas and uses its own purchase agreement rather than the standard TREC form. The deposit forfeiture terms in Perry Homes contracts may differ from what buyers expect based on standard Texas real estate transactions.
Builder-Specific Details
Long Construction Timelines
New construction timelines can extend months beyond original estimates. Deposit forfeiture provisions may penalize buyers who need to cancel due to changed circumstances during extended build periods.
Combined with Closing Penalty
Deposit forfeiture provisions may work alongside daily closing penalties to create compounding financial pressure on buyers to close even when concerns remain unresolved.
State-by-State Enforceability
Enforceability of this clause varies by state. The following reflects Perry Homes's operating states.
| State | Status | Note |
|---|---|---|
| Texas | Likely Enforceable | Texas courts generally enforce liquidated damages provisions, including deposit forfeiture, if the amount is a reasonable estimate of anticipated damages. Perry Homes' deposit forfeiture provisions are likely enforceable under Texas law. |
Related Clauses in Perry Homes Contracts
This clause often works in combination with other provisions in Perry Homes's purchase agreements.
Closing penalties compound the financial pressure created by deposit forfeiture provisions.
Deposit disputes that affect multiple buyers cannot be pursued collectively when a class action waiver is in place.
What Buyers Can Do
- Understand the deposit amount and forfeiture triggers. Know exactly how much earnest money is at risk and what specific circumstances allow the builder to retain it. Identify whether the contract provides any cancellation rights without forfeiture.
- Negotiate contingency protections. Attempt to negotiate contingencies that allow deposit recovery, such as financing contingencies, appraisal contingencies, or inspection contingencies.
- Have the full contract scanned before signing. This clause is often one of several interconnected provisions in Perry Homes contracts that collectively limit buyer remedies. A contract scan can identify all of them.