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Scott Spinel…, Real Estate Pro in California

If someone puts down 200,000 on a million dollar condo, what is the maximum the seller may keep.

Asked by Scott Spinello, California Tue Mar 10, 2009

Client buys condo in 04 for 1million. The condo is now worth @800k, the builder has finally finished the building and wants to close. If the buyer wants to pull out, what is Florida Law on maximum deposit that a seller may keep?

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The proper attorney will return all of the deposit using the fact that the builder is not producing a product of the same value as was promised at time of deposit, which is a $1,000,000 Condo, this condo is now only $800,000 and this is for sake of financial value not the same product. A good Real Estate Attorney would be able to say the Builder has not lived up to advertised details!
0 votes Thank Flag Link Wed Jun 15, 2011
Some of the advise below is spot on, Scott.

1) CAREFULLY READ THE CONTRACT and find what it says about deposits
2) Write protest letters and call the builder to try to amicably resolve the matter - document EVERYTHING
3) Hire an appraiser or Realtor to provide an opinion of value so you can figure out where you truly stand
4) Consult a real estate attorney, well versed in contract law and experienced in cases against builders and use him when the moment dictates
5) ACT QUICKLY and decisively - time is of the essence

Luck, Is When Preparation Meets Opportunity (Mark Twain)
Web Reference: http://ISellMiamiBeach.info
0 votes Thank Flag Link Tue Jun 14, 2011
and get attorney was a great first answer, this is not something one should try to do alone.

John
0 votes Thank Flag Link Tue Mar 10, 2009
Hi Scott,
You have to look to your sales agreement (contract) to see what the "seller" is permitted to keep once there is a retraction of the contract. That is the SHORT answer. HOWEVER:.....

A closer look at this is required: it depends on the agreement the builder has with the party that is holding the construction loan. Very few builders build with their own money. They let the banks do that; once x # of units are sold, then the bank switches from a construction loan to a more permanent one or they get all of the new mortgages for those who purchase in that building. Either way, you need to seek out what is the CURRENT relationship between the banker/holder of the money and the holder of the property, i.e. the builder.
If the condo as droped that much (1st) who is saying "what it is worth"? Is it a real estate professional, the nieghbors or the banks appraiser?

USUALLY when buying a condo in pre-construction stages, the new buyer only has to put up 5% or less of the purchase price (contract price) until it is within 60-90 days of the building (or the unit) gets its C of O from the city-county. (that is certificate of occupancy) ONLY then can a builder close on the unit. And then the buyer must come up with the remainder of the 10% deposit and their mortgage or whatever their sales contract stipulates is the accepted method of payment.

Make sure your builder is still SOLVENT before you close....you really may want to get an attorney given the market conditions today unless you have a competent real estate professional that was part of the original transaction....then she/he may be able to shed mmore light on your options because the bottom line....you do NOT want to overpay for a property if you do not have to!

Good Luck
Sharon
0 votes Thank Flag Link Tue Mar 10, 2009
ALL.

And I would be very surprised that a 2004 $ 1,000,000 condo is now worth $ 800,000.
I would think $500,000 or less - where did the $800,000 come from?

John
0 votes Thank Flag Link Tue Mar 10, 2009
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