Sellers wanting to breach contract or have us increase our offer

I’ve scoured this group and haven’t found anything like what my husband and I are going through….our realtor also says it is the first time he’s ever had this happen.

We are in the process of purchasing a new home. We found a home we love and made an offer contingent on us selling our home first. The sellers accepted our offer and we listed our home and were under contract a week later for the new home and our current home. When we had the new home inspected and found a few minor issues we came back with a lower offer request and they also accepted this. So they’ve now twice accepted an offer from us.

Because of the type of financing the buyers of our home used there were some hoops to jump through including several repairs we were required to make, no problem, knocked those out and we are good to go. Financing on our end for the new home is good to go. We are within 2 weeks of closing on the sale of our home and should have been able to be closing on the new home directly after.

This is where things went bad. The realtor reached out yesterday stating the sellers “didn’t know” how much they owed on their current mortgage and it was more than they expected, close to 10k more than our offer. They also couldn’t cover the realtor fees, about another 10k. They were requesting we come up in price to cover the 20k that they can’t.

I asked for proof of Payoff and received it….part of the issue is that they have not been making their mortgage payments for about 10 months so the final Payoff consists of about 8k in fees and interest from not making their payments.

I am very against coming up in price, but at the same time we will have nowhere to go in about 2 weeks. If we do come up though I am really only concerned about covering the 10k for their payoff….not the 10k in realtor fees. We are already paying 6% realtor fees for the sell of our property (same realtor on the house we’re buying)…

Has anyone experienced anything like this and what are our options? Can the home still close without the fees being paid to the realtor? What options do we have?