If it was in an Escrow, it couldn't be touched until the Escrow closed.
Deposit money can be held in a Broker's Trust account until the Title Company needs it;
but if the Broker "co-mingles" those funds with other monies, they could be indicted, or at least lose their license.
If the Buyer writes the check to anyone other than the Title Company or a Trust account, then they screwed up and can't claim ignorance; not in this day and age.
Good luck and may God bless
I would not hire a builder that denied me access. It is fair for a builder to limit access due to insurance and flow of construction but to deny is unacceptable.
A non-binding deposit for pre construction enables the builder to obtain financing to proceed with the project and is perfectly acceptable but you could also request that YOUR attorney hold the deposit rather than the builder.
Of course, your attorney should be guiding you here.
But, I have seen.. escrow money held in an escrow account until closing either the Realtor brokerage account, the buyers attorney account or the seller (builder) attorney account.. it would be written into the contract.
What also will be in the contract is things that are you may want in your property that will be your expense and funds that could/would be used for that reason. (this would be in the contract also) If you wanted the baths with imported tile.. it may be written someplace that you pay for these upgrades to be installed and if you back out and these are installed, you would lose that money.
It could be that your down payment could be applied to your upgradesâ€¦ again.. it may be in the contract.
It may be a hazard for the buyer to enter a property during construction and you may not be allowed to enter the premises for safety reasons at your leisure. I would think that an prearranged tour of the job site would be arranged.
By your final question it sounds as though you want to go to a builder and say I want to buy a place and you want the builder say "o.k" its yours.. no money down, nothing. That probably will not happen.
If a builder would not let me look at a home during the build process, I would be highly suspicious. It is a red flag to me. Maybe he doesn't want to be bothered or is afraid you will want changes made.
If you have not contracted to buy from him, that's a different story and may explain the "reserve". The red flag is still present, just pinkish now.