It is my understanding that California is not a "passive contingency removal" state, meaning the buyers contingencies MUST be removed in writing. If you have not removed your financing contingency in writing and the seller has not issued a Notice to Perform that you have not complied with, then you should be able to cancel the agreement and get your deposit back if you cannot obtain a loan. Check with your agent to find out the specific details of your transaction.
Coldwell Banker Residential Brokerage
15490 Ventura Blvd., Sherman Oaks, CA 94103
Have you waived your Loan Contingency in writing as of yet? If the answer is no, then you have the ability to get out of the transaction and get your entire deposit back. The standard California purchase agreement gives you 17 days after acceptance to waive your contingencies unless otherwise agreed to in writing. However, with your loan contingency you have the option to keep the loan contingency active until the designated loans have funded if your Realtor checked the proper box on page 2 of 8 of the purchase agreement, and if the Seller's did not counter this out of your offer. While some purchase agreements do not require contingency removal to be in writing, the standard California purchase agreement requires your contingency removal to be in writing. Speak with your Realtor and inquire as to the terms of your Loan Contingency. Furthermore, you may also try to speak with another Lender to see if you qualify. Good luck!
You may try to salvage the deal by determining if a co-signer on the loan would ensure your approval.
Best of luck,
David Jaffe-SRES, CDPE