Legal Question in Real Estate Law in Maryland

Re: Is a seller in breach if the buyer cant get finance by the settlement.

Although the buyer may be in technical breach of the contract, you'd want a release from him before selling the property. He may choose to sue you and the purchaser. Of course, it would likely be something of an uphill battle for him to succeed, but he could make things unpleasant for you until you settle or until you go to trial (and going to trial could take from six months to more than a year.

Your best strategy at this point would be to immediately return his earnest money deposit and hope that he goes away.

Re: Is a seller in breach if the buyer cant get finance by the settlement.

The answer to your question depends on whether the contract contained a financing contingency. That is a clause that says that if the buyer cannot obtain the necessary financing by a certain date, he can cancel the contract and recover his deposit. The seller would also have the same right--that is, to cancel the contract and move on. So I think you were within your rights and didn't need to wait for the buyer's agreement to the cancellation before reselling. Otherwise, a recalcitrant buyer who has no realistic possibility of being able to purchase the property could tie the seller up indefinitely.