A buyer waived her financing condition to win the deal. The court awarded $366K in damages

By the Deeded Editorial Team. Last updated April 20, 2026.

TL;DR

• In spring 2022, an Ontario buyer waived her financing condition to win a $1,252,500 deal. She couldn't line up a mortgage and failed to close in August 2022.
• The sellers granted multiple extensions, then relisted. The home sold in March 2023 for $965,000.
• The Ontario Superior Court awarded the sellers $366,513: a $287,500 price gap, $31,906 in carrying costs, and $47,107 in interest on a new-build home the sellers had already committed to.
• Buyers, sellers, and their agents should treat this case as a baseline. Waived conditions have real teeth, and the seller's duty to "mitigate" sets a surprisingly low bar.

The short version

A buyer waived her financing condition to win a bidding war.

The deal was for $1,252,500, with closing in early August 2022.

She couldn't get her mortgage approved in time. The sellers gave her extension after extension. Still no financing.

She never closed.

The sellers relisted the property. In March 2023, they accepted $965,000. That's $287,500 less than the buyer had agreed to pay.

When the sellers sued, the buyer didn't try to deny the breach. She admitted it. The real fight was over how much she owed.

What the buyer argued

Two arguments, both rejected.

The first was that the sellers should have accepted her new offer in January 2023. She'd pulled herself together enough to put a fresh offer on the table with a February 2023 closing. Had the sellers taken it, she said, they would've avoided the worst of the market drop, and the damages would be smaller.

The second was that the sellers hadn't done enough to mitigate their loss. They should've found a better price. They should've marketed the property differently. The $965,000 sale, she said, was too low.

Why both arguments lost

On the January 2023 offer, the court wanted to see evidence that the buyer could actually close this time. She couldn't produce it. No mortgage pre-approval. No proof she had the funds. Just an offer on paper. The court wasn't about to penalize the sellers for refusing a second deal that looked a lot like the first one.

On mitigation, the court laid out a principle every agent should know cold: sellers aren't expected to chase every possible avenue to reduce their loss. They're expected to take reasonable steps. "Reasonable" gets measured by what the seller actually did, based on the advice they got from their real estate professional, in the market they were actually working in.

The Singhs and Kaur relied on their broker. They accepted a reasonable offer in a declining market while carrying two properties at once. That was enough.

The buyer, by contrast, brought no expert evidence. No independent appraisal. No broker opinion on what the property should have sold for. No analysis of the market in late 2022 or early 2023. Nothing. The court called her mitigation argument "pure speculation" and tossed it.

The damages

The judgment worked out to $366,513, broken down like this:

• $287,500 for the difference between the failed sale price ($1,252,500) and the eventual resale price ($965,000)
• $31,906 in carrying costs (utilities, property insurance, property taxes, and mortgage interest between August 2022 and March 2023)
• $47,107 in interest the sellers had to pay on the financing for a new-build home they'd already committed to buy in 2021

That's on top of the forfeited deposit. For a deeper look at how much of a deposit buyers can actually lose, see Deeded's piece on what happens to your deposit if the deal falls through.

Four things every agent should take from this

Waiving a financing condition is a real financial bet.

In a hot market, it's often the move that wins the offer. When your buyer asks whether to waive, they need to hear the honest downside. If financing falls through, they don't just lose the deposit. They can owe the full price gap on resale, carrying costs for as long as the seller holds the property, and any consequential damages the seller can prove. Our breakdown of what happens if you can't close lays this out for clients in plain language.

The court won't save a buyer from a bad mortgage outcome.

The Feneich buyer couldn't get financing. That's a sympathetic fact. It changed nothing. Once the condition was waived, the court looked at the contract, not her circumstances.

Mitigation has a low bar for sellers.

Sellers don't have to run a perfect resale process. They have to follow reasonable advice, usually from their listing broker, and act in good faith. If you're the listing agent on a post-breach resale, your paper trail matters. Document your pricing rationale, the offers considered, and the timing of each listing decision. That record is the seller's evidence if damages ever get contested. Deeded's overview of what to do when a buyer won't close walks sellers through the immediate steps.

Domino deals magnify the damages.

Watch the $47,107 interest number. The sellers were only on the hook for that because they had a new build they'd committed to back in 2021. If your seller clients are in a domino (selling to buy), help them model what a failed closing could actually cost. It isn't just the price difference. Carrying costs, bridge interest, new-build deposits, and a shaky closing timeline on the new purchase all come into play. Pre-construction buyers should also read our piece on walking away from a pre-construction deposit before they even think about it.

The client conversations you should be having

With buyers, before they waive anything. Most agents walk through the upside of a clean offer. Try running the downside too. What happens if the lender pulls the mortgage? What's the backup? Family loan? Another property to sell? Line of credit? If the answer is "I don't know," they shouldn't be waiving the financing condition.

With sellers in a soft market, especially domino sellers. Walk them through the exposure side of a buyer walking. Use Feneich as the example. A $1.25M sale that fails and resells at $965K isn't a $287K problem. Once you layer in carrying costs and bridge financing on a new purchase, the real exposure gets close to $370K. That number changes how you negotiate extensions, how you price a relisting, and how quickly you move if a buyer starts to wobble.

With every client, about the deposit. A lot of buyers still think the deposit caps their exposure. It doesn't. The deposit is the floor of what they stand to lose, not the ceiling. Feneich is the case that makes that real. Deeded also covers this head-on in is it a good idea to just walk away from your deposit?

Deals fall apart all the time. Most of them don't end in a $366,513 judgment. The ones that do have one thing in common: a buyer who didn't understand what they were signing, and didn't get advice quickly enough when things started going sideways.

Use this case. It's the one that makes the stakes concrete.

Frequently asked questions

What happens if a buyer waives the financing condition and can't get a mortgage?

The buyer is in breach of the agreement. They can lose the deposit, owe the difference between the original purchase price and any lower resale price, and be responsible for the seller's carrying costs and related losses. In Singh and Kaur v. Feneich, those numbers added up to $366,513 plus a forfeited deposit.

What is the seller's duty to mitigate damages in a failed Ontario real estate closing?

The seller must take reasonable steps to limit their loss, usually by relisting and accepting a reasonable offer. They do not have to chase every possible avenue or accept every offer that comes in. Courts measure reasonableness by what the seller actually did in the real market, typically relying on a broker's advice.

How are damages calculated when a buyer fails to close?

Damages equal the difference between the contract price and the eventual resale price, plus related carrying costs (taxes, utilities, insurance, mortgage interest) and any consequential losses caused by the breach, such as interest on a replacement purchase. In Feneich, the court also awarded $47,107 in new-build interest the sellers had to pay because of the delayed sale.

Can the buyer be liable for the seller's new home financing costs?

Yes, if those costs flow directly from the buyer's breach. If the sellers committed to a new purchase in reliance on the failed sale, and had to carry interest or deposits because the sale didn't close, those losses can be added to the damages claim.

Does a lower later offer from the same buyer reduce the seller's damages?

Not automatically. In Feneich, the buyer argued the sellers should have accepted her January 2023 offer at a lower price. The court rejected the argument because the buyer couldn't prove she was actually in a position to close on the new offer, which made refusal of the offer reasonable.

‍Primary source: Singh and Kaur v. Feneich, 2024 ONSC 5776 (CanLII). This article is general information, not legal advice. For advice on a specific transaction, talk to a licensed Ontario real estate lawyer.

Last updated April 20, 2026.

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