Seller wants to back out due to low appraisal - Who is right?

[hector3123]

We signed a contract to purchase ($700k) home and entered into escrow. The home inspection showed a lot of repairs, so we decided to cancel the contract. My realtor sent “Cancellation of Contract” to the seller.
The seller called us back saying that they are willing to fix the repairs if we are interested in moving forward. We decided to move forward and ordered an appraisal. The appraisal came at $660 and now the seller is not happy. Our contract stated that if the appraisal comes lower than the contract price, we will pay an additional $10k over the appraised value. In this case, it is $660+$10=$670. Now seller is trying to use the cancellation notice sent by us earlier against us.
Seller’s agent’s response after appraisal: “As you're aware the Buyer cancelled this escrow on 12/23/2021. If your Buyer would like to resurrect this transaction the Seller is willing to, under the at $700.”
Buyer’s agent’s defense: “You are correct that we sent in a cancellation on 12/23/2021. However, you reached out via phone and asked us what we could do to keep the transaction going. In "Good Faith" we retracted our cancellation. I have an email correspondence with you from on Jan 7th stating "We are back in play with this file". We conducted the appraisal to proceed with the file. We provided the lender everything needed to prepare for loan docs. So to reiterate, the cancellation was not finalized AND was retracted. Technically, the seller would have to abide by the contractual obligation of the RPA and honor $670,000 for the purchase price.
Who is right in this situation?

[ua_guy]

If the documents say the seller is still on the hook, I'd lean on that. But I think it really depends on what you want to do at this point. If it's something you want to pursue hard then I think you would want to get the realtor's firm involved for some legal backing.

Sounds like it appraised low and needs a lot of work. The seller may not remedy the repairs to your satisfaction, while checking the box for remedying the repairs. If you aren't emotionally invested in the house, this might be a good point to walk away?

[SabrinaMaxwell]

If the contract has already been signed, it should specify the conditions if one of the parties terminates the contract. Most likely, you will have to pay a certain amount of money. When I bought an apartment, I carefully studied all the terms of the contract; moreover, I thoroughly analyzed the house. Because of a few little things, I could lower the price significantly. After buying the house, I contacted a great company that does home redesigns. Thanks to the redesign, there is a lot of space in the house.