Home Buying in 90066>Question Details

itsfreeforaj, Home Buyer in 12309

My question is about earnest money that I paid on a house i was trying to by, when the selling ups and fires her realtor and gets a new realtor with

Asked by itsfreeforaj, 12309 Wed Oct 3, 2012

My question is about earnest money that I paid on a house i was trying to by, when the selling ups and fires her realtor and gets a new realtor with a new company and proceeds to sell the house to a new buyer without ever releasing the earnest money we put down on the property.

Isn't there some sort of law that states if a realtor gets fired then the all agreements with that realtor are null and void. Is the old realtor supposed to seek out the new realtor and give them my earnest money to continue the purchase? Or is the realtor free to give back the money to me even if the seler refuses to sign the release form?

If the sellers are being spiteful and refuses to sign the release, is there not a provision for unfair practice or if the seller is not being reasonable. In this situation what is to prevent the seller to play this game multiple times? Put thier house on the market, collect earnest money, back out of selling the house, and refuse to sell to the buyer and repeats.

Help the community by answering this question:


Hi Mack - right to the point - (and correct) as usual : ) I love watching you on Trulia - a guy who just says it like it is, and makes no bones about it.
1 vote Thank Flag Link Mon Oct 8, 2012
Thank you, Jeri!
Flag Tue Oct 9, 2012
There is no such law. To the contrary, the seller cannot fire the brokerage while they have a purchase contract in place.
1 vote Thank Flag Link Mon Oct 8, 2012
Oh…you need a real estate attorney. There are lots of questions here. Was the earnest money cashed? put into escrow? Was a contract accepted in writing by the seller, or was the agent just holding your earnest money uncashed in case the seller accepted it? If there was no acceptance, you never had a contract and your agent can give you back your money. It's most likely that it was never cashed, but rather, your check was held, uncashed in their trust account file. They actually need to give the check back to you upon your demand if there is no contract, regardless of whether the seller will sign anything. Now if they did sign your offer before "firing" the agent, that's another story altogether.

By the way, it's very unusual for a seller to be able to just "fire" an agent. If that agent had a valid listing agreement with the seller, generally it isn't an "at will" contract that the seller can just revoke any time he/she likes without cause. It's possible your real estate agent has a breach of contract case with this seller as well.

Talk to a lawyer, and have your agent talk to their company's errors and omissions insurance people. , who will generally have attorneys on staff to help minimize legal exposure.
0 votes Thank Flag Link Mon Oct 8, 2012
I have a great idea, read your contract! Your EMD is protected if the situation you described is in fact what happened. Call the escrow company or have your agent do it for you, as they should have anyway.
Did you have an agent working with you?
0 votes Thank Flag Link Sun Oct 7, 2012
OK, who did you give your deposit check to?

It should have been given to your agent and held UNCASHED until you had an offer accepted and an escrow opened. If you had an opened escrow it would have been delivered to the ecrow company. .

If the seller has cancelled the listing with the original agent, then escrow has to be canceled before they can re-list the home with another agent. In this case, once cancellation of escrow forms are signed by all parties the seller would in turn release the buyer's deposit. Especially since the cancellation is not a result of buyer's failure to perform. There is no reason in the case you have outlined for the seller to retain the buyer's deposit.

Is your agent assisting you at all to remedy this situation? If not, contact his/her broker and explain the situation. Perhaps the brokers can get this resolved with out you having to take further action.

Best of Luck to You,

Kawain Payne, Realtor®
0 votes Thank Flag Link Sat Oct 6, 2012
Hello it all sounds a little confusing, your EMD CHECK should have been given to escrow when you opened escrow. What escrow company was designated? Call them and let them know you were left in the middle of a transaction with an awol realtor! and find out if the check even made it to them. Was it cashed?.. maybe you can call the head broker of your ex agents office and bring this to their attention. Sounds to me like you had an agent that was not looking out for you. Wishing you the best here.
vic m
0 votes Thank Flag Link Fri Oct 5, 2012
Earnest money deposit should have been put into Escrow? Was it? Then it should still be there and cannot be released to anyone without written authorization by both parties. What reason is the Seller giving for not signing the release? They already sold to someone else.
If you did not use an Escrow, whom did you give the check to? Who was the check made out to? Was it cashed?
The behavior you describe certainly seems unethical. But I do not see how they can benefit and keep the deposits if there is an Escrow involved.
0 votes Thank Flag Link Thu Oct 4, 2012
Hi Fora J:

I suggest you get a real estate attorney to discuss this. If you are under contract and have submitted your ernest money deposit to escrow and escrow is opened, regardless of who the agent is, you have a valid purchase agreement and all must play by the rules of the contract. A contract is a contract.

They cannot sell the house to someone else with a previous accepted offer and an open escrow unless they sign cancellation of the offer/escrow.

Did they open escrow? Who did you pay the ernest money deposit to and in what form?

Your best bet is to talk with an attorney.

Good luck.

0 votes Thank Flag Link Thu Oct 4, 2012
If a purchase contract was signed, it is an agreement directly between you and the seller. The seller breached against you (although your agent/broker should be fighting for you). You imply, but don't clearly state, whether funds were in escrow or in a trust account. In the trust account, your actual agent/broker is holding the funds and should have returned them. This, as they say, is a fine mess. I can't believe the amount of time that must have passed. As for the scenario of this action being repeated, it is highly unlikely (unless you see it going back-and-forth between the same parties). When the seller took issue with their agent, they likely threw out all prior associations, and you were a victim of that.
0 votes Thank Flag Link Thu Oct 4, 2012
As many of the agents have already stated, you need to speak to your agent immediately. He or she will be well versed in the process, especially since he or she is dealing directly in this situation. Because of having a contract on the property, you also have the right to sue for damages or specific performance. The main thing is to try to communicate with the former seller's agent in an attempt to work it out before resorting to the courts. This may just be an example of improper communication on the part of the seller's agent and can be cleared up fairly easily by simply communicating effectively.
0 votes Thank Flag Link Thu Oct 4, 2012
Can you explain your situation more. Did the Seller cash your check or not? did you have a signed contract?

You can also contact me at:

Simon Darvish
Audrey Max Estates
0 votes Thank Flag Link Thu Oct 4, 2012
If your money is in escrow and you have a signed contract you need to contact a real estate attorney right away. They can not just change Realtors mid stream and not abide thd contract.
If its like a short sale situation and you put money on escrow and your offer has expired and they won't realesse your funds you will have to sue them to get it back.
I would start with putting something in writing telling them what you want, give them a deadline to perform and a consequence (law suit) if they don't.
Good luck.
Web Reference: http://www.LauraCoffey.com
0 votes Thank Flag Link Thu Oct 4, 2012
Do you have a realtor or an agent represening you in this?

Whom did you make your deposit check payable to?
0 votes Thank Flag Link Wed Oct 3, 2012
A contract was signed the rules of which need to be abided by. Your agent and broker need to be involved in this immediately.
0 votes Thank Flag Link Wed Oct 3, 2012
It is best to ask your realtor to handle this situation.

In case Deposit was made to broker account - then you should contact your realtor/broker to ask them to release deposit back to you.

In case deposit was made to escrow account - you should contact escrow and ask them for refund of the deposit on this transaction.

Ether way it is best to contact your realtor/broker and let them handle this situation.

Hope this info will help you!

Please contact me anytime!

Free Consultation 424-777-9377

Help with any Real Estate Transaction Buy & Sell!

Thank you for your time.

Should you have any questions - please feel free to call me Toll Free: 1-855-TRUST-55 (1-855-878-7855) ext. 777.

Sergey Fednov
President - Realtor
- Trust Sale Realty -
Residential & Commercial Real Estate
Toll Free: 1-855-TRUST-55
Toll Free: 1-855-878-7855
Phone: 424-777-9377
Fax: 310-356-4925 http://www.TrustSale.com
0 votes Thank Flag Link Wed Oct 3, 2012
You first recourse is to contact the fired Listing Agent's BROKER:
This should be all that is necessary.

If you don't get relief, you can file a grievance with the local MLS board.

Good luck and may God bless
0 votes Thank Flag Link Wed Oct 3, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer