Browse Proptionary encyclopedia

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Performance

DEFINITION

Fulfillment of an obligation or promise.

EXPLANATION

The performance of a contract can be discharged in certain circumstances.

The contract can be discharged if there are certain factors beyond the control of one or both parties that causes an impossibility of performance. For example, if a borrower no longer has the funds to purchase the house or cannot access any lending terms, it would be impossible to purchase the property. Another instance includes the buyer and/or spouse losing his or her job, for example, rendering the purchase impossible. Under these scenarios, the involved party can be excused.

The performance of a party can be excused when the impracticability of performance makes a task difficult or nearly impossible to fulfill. This is also called commercial frustration. If economic circumstances change for one or both parties, said parties can be excused for nonperformance. The most common instance of this is if the buyer can no longer afford to purchase the house, either because of lack of financing, or not possessing enough money to pay the required down payment. Another instance includes the scenario of a seller no longer wanting to sell the property because he or she cannot afford a switch property. The standard reasoning for one’s failure is due to a financial hardship.

Specific Performance

Certain contracts have clauses which allow one party to require the other party to meet an obligation. Specific performance of an obligation can be requested. Specific performance is a court order that requires a party to perform an obligation found in a contract that the defendant has failed to fulfill. Because no two pieces or parcels of land are exactly alike, each scenario is unique and individualistic in nature.

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