Home Buying in Springfield>Question Details

Camilosi, Home Buyer in Springfield, MA

Can I get deposit back on short sale?

Asked by Camilosi, Springfield, MA Fri Oct 21, 2011

put a deposit on June 27 when signed on the purchase and sale agreement and is october 21 and still waiting for the sellers bank short sale approval. Can we back out and get our deposit back? There is an additional provision on the agreement that gives the seller 60 days from signing the sale agreement to obtain written short sale approval from any and all lenders. That means we get our deposit and can walk away?

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Sounds like you should be able to get your deposit back however consult the attorney you hired to review the PS. He/she will be able to give you good legal advice on your rights and also help get your deposit back.

Sorry it didn't work out for you. I advise you steer clear of short sales and foreclosures if possible. They are covered in bureaucratic red tape and who knows what will happen with all the outstanding lawsuits against foreclosures in MA and where it leaves current owners of foreclosed properties.

Get yourself an exclusive buyers agent who can guide you through the process.

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0 votes Thank Flag Link Tue Oct 25, 2011
You need to have an attny look at your P and S. If you used a buyers agent hopefully they put some language in the contract that would help you. Short sales are npot always a good deal , but can be very time consuming.
0 votes Thank Flag Link Sat Oct 22, 2011
You must always go back to the purchase and sale.

Usually in a short sale there is a period of time you allow the seller to obtain short sale approval. When that date expires you can back out of the deal and receive your deposit back.

It really depends on the wording in the purchase and sale.
0 votes Thank Flag Link Fri Oct 21, 2011
Review your executed sales agreement governs what can or can not take place

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0 votes Thank Flag Link Fri Oct 21, 2011
Based on the information you shared, you should be able to get your deposit back. Be sure to operate within the scope of your purchase and sale agreement, and notify all parties appropriately.

Hopefully you aren't taking any other losses, like inspection or appraisal costs. In the future, there are a few other ways to limit your losses when dealing with short sales. A qualified attorney should be able to help you with the specifics.
0 votes Thank Flag Link Fri Oct 21, 2011
I disagree with Tom Moore but perhaps things are done differently in N.C.

In Ca., if a buyer makes an offer and a seller accepts the offer you have a contract. That is true for short sales and other sales. The difficulty with short sales is the short sale lender approval contingency. In other words, the transaction cannot be finalized unless the short sale lender approves it.

It appears that approval was not granted within the period written into your offer. I would think that you could cancel the transaction and get your deposit back but there is no way that I can know for sure since I do not know what your contact says.

Your agent and/or attorney do have that information. What advice have you gotten from those who are your advisors?
0 votes Thank Flag Link Fri Oct 21, 2011
Yes it sounds like your contract is void at this point. You should sign a release and get your deposit back
0 votes Thank Flag Link Fri Oct 21, 2011
You should have your attorney review your offer and all addendums associated with it. There may be a way for you to withdraw but sometimes deposits become non-refundable. This is all spelled out in the offer & addendums. Short sales can take quite a while to navigate, one reason why the prices are enviable. Your agent/broker can also assist you in this. Massachusetts is an attorney state so your best course of action is to contact your attorney to review and advise you on your legal options available to you.

Hope this helps,
0 votes Thank Flag Link Fri Oct 21, 2011
Sounds like yes. You should have an attorney ask him or her to do this
0 votes Thank Flag Link Fri Oct 21, 2011
Yes you can since you have no contract. I would not have even accepted money from you until you did have a contract. A contract in a short sale requires acceptance from the lender.
0 votes Thank Flag Link Fri Oct 21, 2011
From the information you have given, I believe you are entitled to your deposit back and can start looking for another home. I would ask your Realtor to review the contract and forms you signed, to insure you you can get it back.
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0 votes Thank Flag Link Fri Oct 21, 2011
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