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  1. #1
    gabby93 is offline Junior Member
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    Can Buyer demand deposit after loan approval period expired? Seller alsonot yet Owner

    What is the name of your state? FL

    Hello,

    How do I handle a situation where Buyer was not able to obtain loan financing, and gave notice of such fact to the Seller 2 days after the expiration of the 30-day loan approval period? Despite the delay in giving notice to the Seller, can Buyer still get his deposit back if the sale was contingent on loan approval?

    Also, it appears Seller did not (yet) have title to the property, as he was in the process of purchasing the property from the original owner and then re-selling it to the Buyer. As long as Seller was in a contract to purchase the property, does he have the right to also enter in a contract for the sale of the same property?

    To complicate matters even further, deposit is being held in Escrow, and Seller is claiming the escrow agent is withholding half of the deposit to pay for its fees.

    Any advice would be much appreciated.

    Many thanks.
  2. #2
    FlyingRon is offline Senior Member
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    If the time for the loan contingency expired, no.

    The seller can recover damages for the breech. If there are specific fees (like the money to set up the trust account) it would be pretty cut and dry. Most real estate contracts allow the deposit to be taken specifically to defray these damages. Sounds like the deposit was pretty small if "half" is taken up on fees anyhow.
  3. #3
    gabby93 is offline Junior Member
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    Flying Ron: Thanks for your reply.

    What I'm having a hard time understanding is how can the Seller rightfully enter into a contract to sell a home for which he does not have title (or does not yet have title)?

    Many thanks.
  4. #4
    FlyingRon is offline Senior Member
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    Because he only has to have title at closing.
    However, it's not clear he doesn't own the property NOW.
    Having deeded ownership and having any potential lose ends that the title insurer wants cleaned up are different concepts. It looks like these are being resolved. You can't use that to get out of your contract. Purchase owner's title insurance however to be sure.
  5. #5
    gabby93 is offline Junior Member
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    FlyingRon: One last question, please.

    If Seller can recover damages for breach (ie Atty fees for setting up Escrow Account), does that mean Buyer can recover at least part of his Deposit, or does Seller have right to keep the entire deposit if he so chooses?

    I was hoping there would be at least some out for the Buyer that would allow him to recover his entire deposit, but it looks like his best option is to now agree to pay for atty fees and recover what is leftover.

    Thanks again for all your help. Much appreciated.
  6. #6
    FlyingRon is offline Senior Member
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    Generally there is a liquidated damages clause in the contract that allows the seller to retain the deposit directly on breach. Since he has very documentable damages specifically relating to the administration of the sale that is all he is asking for, it's a slam dunk.

    Your option is to honor the contract or deal with the consequences of the breach.

    Other than a little delay (which appears to be to satisfy your side), it would appear he has not breached the contract. It seems your own remorse rather than anything the seller has done that wants to end this.
  7. #7
    OP85063 is offline Member
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    You may also want to ask for a detail expense sheet to see how much fee was charged to get everything done, so you can get the balance of your money back also. Just don't take their word for it.
  8. #8
    FlyingRon is offline Senior Member
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    Thumbs down

    You can ask, but unless you want to take the seller to court, he's not obliged to provide one.
  9. #9
    gabby93 is offline Junior Member
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    Many thanks for all the advice. Greatly appreciated!
  10. #10
    andreabriones is offline Junior Member
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    Angry Short Sale Game

    I signed a contract with a trustee who apparently was buying a short sale from the bank and then selling it to me (the listing agent never informed us of this fact until after the contract was signed - in fact his listing was inaccurate as well). Aparently the seller was able to negotiate with the bank since he is the holder of the land trust altough not the mortgagee.

    After a week of signing the contract, the listing agent forwarded a letter of approval from the bank, with an addendum in which he stated that the deal was contingent upon approval from the bank. Two days letter he sent a letter of approval from the bank and asked us to close within 14 days. A week later, when we were ready to close, the seller's agent calls us and asks us for an extension because he learns to the negotiator/investing advisor to trustee wanted more money for "repairs" which were NEVER done to the property.

    Long story short, they asked the bank to re-negotiate their numbers, AND THE BANK WILL NOT DO THAT, they have accepted their bottom line and THAT'S IT! So we (my lender and I) have been on hold with an underwritten loan for about a MONTH.

    Finally today, they say that they don't want to buy the property at the amount the bank will accept and therefore they will not sell the property to us.

    This breach of contract has a name, and I am sure someone out there knows it. Please advise. Also, they made us pay for appraisals ($600) and inspections ($600) and now they just walk away like nothing happened.

    PLEASE GIVE ME YOUR INSIGHTS!!

    Thanks


    Quote Originally Posted by FlyingRon View Post
    Generally there is a liquidated damages clause in the contract that allows the seller to retain the deposit directly on breach. Since he has very documentable damages specifically relating to the administration of the sale that is all he is asking for, it's a slam dunk.

    Your option is to honor the contract or deal with the consequences of the breach.

    Other than a little delay (which appears to be to satisfy your side), it would appear he has not breached the contract. It seems your own remorse rather than anything the seller has done that wants to end this.
  11. #11
    FlyingRon is offline Senior Member
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    My insight is that you should keep this in the other thread you started and not post your soap opera on to other's threads.
  12. #12
    andreabriones is offline Junior Member
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    Arrow Really?

    Quote Originally Posted by FlyingRon View Post
    My insight is that you should keep this in the other thread you started and not post your soap opera on to other's threads.

    I have - as a member - the right to chose where to post my questions and I posted my inquiry where I deemed necessary. If you have no expertise/knowledge to share, don't answer. Some people are just so miserable - SOME PEOPLE - maybe not you but you post sure doesn't help prove me wrong.
  13. #13
    VeronicaLodge is offline Senior Member
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    and we have the right to not answer you questions and ignore you
  14. #14
    HomeGuru is offline Senior Member
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    Quote Originally Posted by andreabriones View Post
    I have - as a member - the right to chose where to post my questions and I posted my inquiry where I deemed necessary. If you have no expertise/knowledge to share, don't answer. Some people are just so miserable - SOME PEOPLE - maybe not you but you post sure doesn't help prove me wrong.
    **A: you have no right to "chose" anything in "you" post.
  15. #15
    andreabriones is offline Junior Member
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    choose - your

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