recovery of deposit in escrow

What is the name of your state? Massachusetts, my husband and I made an offer (which was accepted) and 2 weeks later signed a purchase and sale agreement. They stalled and stalled on signing the p&s because they didn't know if their deal on their new property was going to work out. They didn't sign the p&s until after the deadline, but we didn't make a big deal of it since we wanted the house and they did eventually sign it. In MA, you give your entire deposit when you sign p&s. We got our committment to mortgage on 7/8 and the closing was tentatively set for 7/26.
On 7/19, my husband was part of a large lay-off. We called the sellers immediately as well as our mort. broker. We no longer qualified for the house and had to back out. The sellers claimed they were keeping our deposit and they managed to get it out of escrow and keep it. We found out from their attorney that the sellers asked our attorney for proof of job loss, but he never told us (we have all kinds of proof). To add insult to injury, we took some $$ from 401K and had to pay taxes on it. It took my husband 6 months to find another job and now we rent again. Is there any recourse for us? Please help!P.S. They sold 1 month later for more $$.

[Souix]

Did you sign a Release of Earnest Money to the seller? What was your financing contingency language in your purchase agreement?

We did not sign any release of earnest money. We are also talking about the whole 3% deposit. I wouldn't mind forfeiting the earnest money (which was $500).

The P&S stated that buyer shall have option, in writing, to notify seller on or before 7/5 (date of mortgage committment) to terminate agreement for any reason.

It seems the law would provide for recovery of funds if it is beyond buyers control (job loss, death, etc).

[BrokerRE]

You need to have an attorney look into the reason for the default. Most of the time, a purchase agreement has a contingency for financing. If financing is denied, then you don't lose your deposit, however I don't know what your purchase agreement has said.

It does appear to me that you may not want to go to the attorney you used for the transaction because of this proof of lay-off thing. It appears that your attorney may have some liability here.

Take it to another attorney and get him to view the case. But first, how much money are we talking about here?

We are talking about $6300 which is a lot to us, but I'm sure not worth paying high legal fees to recover. What are our chances of getting this attorney to pay it since he didn't protect us in the contract or after when they got our escrow money?

[BrokerRE]

You can rest assured that your attorney won't invite you in with open arms, and write you a check, and give you a cup of coffee.

The reason I asked how much was involved, was specifically because I think you'll have more into chasing this money legally, than you would getting the money back.

You really need to have an attorney advise you on how to proceed.

[HomeGuru]

Writer, you may want to contact escrow and ask them who authorized them to release the monies to the Seller. Whoever did should be liable to pay you back.