Collection of Advance Payment for service charges of a SBA Loan not completed

[Alishaiq]

What is the name of your state? Texas

I was trying to purchase a Deli Business through a Business Finance Consultant Lady as my broker. It was a SBA Loan for $150K. She contacted me with a California based Bank. To cut the long story short, the Sales and Purchase contract expired, chapter was closed.

This broker took all her 2% service charge from me in advance. Out of which $500/- was as advance non-refundable payment. In the Fee Agreement it is clearly written that only $500 is non-refundable advance payment by client, but the rest is no where mentioned that it is not refundable or not. Is she suppose to return my $2500/- back since the loan was not completed and the Contract was expired?

Exact Quote from the Fee Agreement is as follows:
Quote: "Loans of $50,000 or less have a flat fee of $1,000. Loans upto $250,000 have a service fee of 2%. for such loans and Lines of Credit, $500 to be paid as a retainer or non-refundable advance by client, balance is to be pad at the time of signing documents, all other conditons apply as is."
UnQuote

The only document I signed so far was when this broker hand me over "Letter of Intent" that I am receiving this letter of intent issued from Bank. After that we never went to closing table or no other documents was signed after that.

Also in that Contract it is written that: "It is understood that all information is confidential and will not be disclosed by either Party."
Having said the above in this contract and I am mentioning a quote from this agreement on this blog, can it violates the contract?

Any one's Advice will be highly appreciated
Thanks
AlishaiqWhat is the name of your state?What is the name of your state?

 

[Bigfoot]

Collection of Advance Payment

Have you contacted the California bank to determine why the you didn't get the loan? Banks that are certified to provide SBA financing can work with you directly. A consultant is just that: a consultant. Doesn't sound like she had any special licenses to operate her business. Your agreement with her is separate from the financing matter.

And yes it sounds like you are due money back, but first find out why the bank gave you a letter of intent and where the breakdown was in terms of fulfilling the agreement towards closing. If it's negligence on her part, then you'll know where to go from there.

 

[Alishaiq]

Have you contacted the California bank to determine why the you didn't get the loan? Banks that are certified to provide SBA financing can work with you directly. A consultant is just that: a consultant. Doesn't sound like she had any special licenses to operate her business. Your agreement with her is separate from the financing matter.

And yes it sounds like you are due money back, but first find out why the bank gave you a letter of intent and where the breakdown was in terms of fulfilling the agreement towards closing. If it's negligence on her part, then you'll know where to go from there.

Bigfoot as per my contract with Consultant, I cannot contact directly to the Bank for Loans before 36 months period.
My Sales and Purchase Contact was expired on July 31st, 2006. It was signed back in May of 2006. Seller himself brought me to this consultant for this Loan. Seller wife and my wife are cousins, therefore I trust him. But later on I find out that Seller's interest is more important to this consultant than I am - means she took money from me $3000/- for services to get me this loan, but she is showing more interest for seller than myself.

Both Consultant and Seller put on hold this loan about 3 times during May to July of 2006. This Deli is in 3 High rise business buildings - In the end of June 2006 Seller find out that the occupancy of this business place is going to be increased by 97% becasue of a Insurance Company moving into this place last month September. This insurance company brought about 800 people more into this business place. Seller also knew that this Insurance Company was bringing in a full kitchen resturant as well in to this business place.

Still Seller was expecting that his business will grow more because of 800 people moving into this business place. Seller specifically told me to wait for 3 months in the end of July. I told him I cannot wait for 3 months, if he wants to sell it right now otherwise return my money back. I gave Seller as well $25,000/- in advance as down payment and to the consultant $3000/- to get me the loan. Therefore, I told both of them if seller wants to back off than I need all my down payments back, but I cannot wait. Both of them never returned my down payments to this date. They put the deal on hold and Contract got expired.

What happened when this Insurance Company moved into this place, instead of business moving up, it went down by 40%. Since the contract was expired on July 31st 2006, and we Seller and Purchaser has to the submit new contract, I offer my new price which is less than the old contract price. Seller is not willing to accept my new offer and I cannot give him the old price becasue of the decrease in sale by 40%. Now the Chapter is closed.

To this date I have not yet received my down payments back from the seller, nor consultant is willing to return my $2,500/- back. On the other hand consultant has send me a expense report two days ago asking from me to pay her more $2,950/- charges like few meetings that I had in the past $250/- per hour - reading my correspondence with her $250 per hour and many non-sensical charges that is not mentioned in our fee agreement.

Before I take a decision to knock the court door, please I need your expert advice.
Thank you Big Foot