California Sellers: When to Use a Notice to Perform (& When to Wait)

By Home Bay

Posted on January 6th, 2017

Delays in a real estate transaction are extremely frustrating. If you’re in escrow in California and someine is dragging their feet, missing deadlines and causing delays, you may feel helpless. But don’t worry – there’s something you can do! Read on to learn when and how you can use a Notice to Perform to keep things moving along.


What is a Notice to Perform?

A notice to perform is a legal tool you can use to force a buyer or seller to fulfill contractual duties they agreed to in your purchase contract in a timely manner. It allows the party issuing the notice to cancel the sale if certain conditions are not met within a 48 hour time period. As you can imagine, that makes a notice to perform a very valuable tool if you’re having a hard time getting your buyer or seller to stick to agreed upon deadlines.

Notice to Perform for Buyers (Notice to Seller)

In many cases, a notice to perform is issued when an agreed upon deadline, like a contingency removal date, has passed and the appropriate action has not yet been taken. For example, a buyer may issue a Notice to Perform to a seller if:

  • The seller did not remove a contingency by the agreed upon contingency removal date
  • The seller neglected to prepare a report of past insurance claims
  • The seller refused to complete repairs agreed upon in an agreed upon Request for Repairs
  • The seller did not provide homeowner association documents
  • The seller did not provide legally required natural hazard reports

These are just a few examples of situations where a seller is violating their contractual obligations agreed to in their real estate purchase agreement. If a buyer issues a notice to perform, the seller has 48 hours to respond. If they fail to do so, the buyer has the right to cancel the contract to purchase the home.

Notice to Perform for Sellers (Notice to Buyer)

Buyers are also held to certain requirements when they enter into a California Association of Realtors purchase agreement. If they fail to meet these requirements, a seller can issue a Notice to Perform just like a buyer can to keep things moving. For example, a seller may issue a Notice to Perform to a buyer if:

  • The buyer neglects to submit a prequalification letter
  • The buyer is unable or unwilling to make an agreed upon earnest money deposit
  • The buyer can not or will not present proof of funds so that escrow can be closed
  • The buyer is late to sign and return requested and required reports and disclosures

When to Act and When to Wait

We never recommend issuing a notice to perform as a first step because it can cause the sale to fall through. Instead, talk to your buyer or seller to find out what’s causing the delay and try to work something out. Check out this post for more advice on how you can prompt action without risking your sale.

However, if you’ve exhausted all other options and your buyer or seller is unresponsive or unwilling to comply, a notice to perform may be just the tool you need to get things back on track. Just go in knowing you could be risking your sale and make sure you’re okay with that potential outcome.

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Posted in Buyer Advice, California Real Estate, Notices to Perform, Seller Advice