Home Buying in 86442>Question Details

no thanks, Home Buyer in Arizona

I just recently cancelled escrow, the seller will not release my deposit. Under what terms are they allowed

Asked by no thanks, Arizona Fri Nov 9, 2007

to keep the deposit?

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Answers

11
The answer to your question depends on the terms of your contract. In most transactions, buyers have a certain amount of time to inspect the property. and there usually are also loan and appraisal contingencies Once the inspections are complete, the buyer either asks for repairs or removes inspection contingencies. Once the appraisal is available, the buyer will either remove the appraisal contingency or try to renegotiate the price if the appraised value comes back lower than the agreed upon asking price. Once the loan has been approved, the buyer may be required to remove the loan contingency. Some contracts provide that the loan contingency remain in effect until the loan has been funded. This clause protects the buyer from losing the deposit money in the event that the loan does not fund.

The more contingencies are removed, the less ways a buyer has to cancel the contract without losing the deposit. Since you are not telling us how far your were into the contract and why you cancelled, we don't have sufficient facts to answer your question. If you cancelled the contract after you removed your inspection contingencies and your reason was just because you changed your mind, the seller most likely would be entitled to keep you deposit. On the other hand, if you cancelled the contract because you were unable to obtain financing and you cancelled before you removed the loan contingency, you'd most likely be entitled to your deposit back. I am saying most likely because what I describe is the most common scenario. Your actual situation may be different, depending on the terms of your contract.

Many times, sellers do not immediately sign the release even when the buyer is entitled to the return of the deposit and the escrow company cannot release the deposit to the buyer without the seller's authorization. The seller may be upset because you cancelled the agreement and may be more willing to release the deposit once a new contract is in place. Good luck to you.
Web Reference: http://www.theMLShub.com
3 votes Thank Flag Link Sat Nov 10, 2007
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
MVP'08
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This question comes up so frequently so...I had to read through and Ute has the most complete answer I have ever read on this subject. We should all make a copy and use when we are in this situation as we all have. It is answers like Ute's that drive this community and make it a better place. Thank you Ute for your contribution!
1 vote Thank Flag Link Sun Nov 11, 2007
First, you need to seek an attorneys advice.
Next to get a good answer a lot more details will have to be given such as why was escrow cancelled and did you have a contingency for why you cancelled.
1 vote Thank Flag Link Fri Nov 9, 2007
Your contract gives you all the terms and conditions, deadlines, for inspections, loan commitments, etc.

have you read your contract? also the escrow officer can and will tell you if you are entitled to the money back or not, even if you are entitled, they must get the sellers approval to release the funds.
SO CALL THE ESCROW AAGET, AND ASK QUESTIONS, SO YOU KNOW WHAT IS REALLY GOING ON.

HOPE YOU DIDNT JUST CHANGE YOUR MIND, IF SO SAY GOODBYE TO YOUR MONEY !!!

I ONCE HAD A BUYER CHANGE HIS MIND 1 DAY BEFORE ESCROW CLOSED, HE LOST HIS $25,000 DEPOSIT.
0 votes Thank Flag Link Fri Mar 12, 2010
Being a real estate agent from the 86442 zip code that you posted question and if you went through one of the escrow offices here, they would have followed the wording and contigency time lines of the contract that you had signed.
0 votes Thank Flag Link Fri Nov 30, 2007
Were you being represented by a Realtor. A contract may have a cancellation period or a time to approve or disapprove any and all inspections or reports on the property. If you were within that time period you may be entitled to have your deposit returned. You may want to consuld with an attorney.
0 votes Thank Flag Link Sat Nov 10, 2007
Pam Winterba…, Real Estate Pro in San Ramon, CA
MVP'08
Contact
Have you spoken to your Realtor about this? Why did you cancel the contract? As pointed out below, the escrow company is simply following the terms of yor contract. They should be able to tell you the specific reason they are holding your deposit.
Web Reference: http://www.cindihagley.com
0 votes Thank Flag Link Fri Nov 9, 2007
Cindi Hagley, Real Estate Pro in San Ramon, CA
MVP'08
Contact
Being that, the terms of your contract are vague, at that. It would be wise of you to consult with an real estate attorney.
Web Reference: http://www.tammyvivat.com
0 votes Thank Flag Link Fri Nov 9, 2007
Forgot to add this...Your Buyer responsibilities are dribbled through all contracts differently. =) Hopefully your local professionals will chime in after you clarify the reason the Seller has not asked Escrow to realease the requested deposit funds.
0 votes Thank Flag Link Fri Nov 9, 2007
Your question was "Under what terms are they allowed to keep your deposit?" The terms in the contract! . If you did not breach any terms...They cannot keep it..Simple. Assuming you have determinable written terms. I didn't really repeat myself..it just sounds like that. Sorry. More info please.

Michael
http://www.MichaelRobertsHomes.com
0 votes Thank Flag Link Fri Nov 9, 2007
Also would be helpful to know if you were dealing with a listed property or a FSBO. Did an agent represent you?
0 votes Thank Flag Link Fri Nov 9, 2007
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