Home Buying in 90016>Question Details

spencky, Home Buyer in Los Angeles, CA

We have signed almost all the papers for buying a house we are waiting for recording and for the bank to do funding can we still pull out?

Asked by spencky, Los Angeles, CA Tue Nov 29, 2011

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Answers

22
You risk losing your deposit if you dont have a valid reason for doing so. You can also be sued for "specific performance," forcing you to buy the home if you dont have a legitimate reason for backing out - but this is very rare since the seller would have to pursue legal action, which is costly.
1 vote Thank Flag Link Tue Dec 6, 2011
GREAT answer
Flag Fri Jun 29, 2012
As stated below, you can back out at any time before recording, but will almost certainly lose your deposit money.
Since this was posted a couple weeks ago, let us know what happened -
0 votes Thank Flag Link Tue Dec 13, 2011
at the very least your deposit is at risk to the seller, and the bank may have a problem too!

by the time you get to the point of signed loan docs you have reached a very late stage and the seller has SURELY made commitments that are hard to quantify.

unless you have a VERY good reason to cancel i can see them suing for specific performance.
0 votes Thank Flag Link Fri Dec 9, 2011
only if the inspection is not up to par. If you had some exit clauses in the contract.
0 votes Thank Flag Link Sat Dec 3, 2011
This can be a bit tricky, check with your agent on the details of your negotiated contract. If you’ve released all contingencies you may be looking at losing your deposit. It’s not as simple as you signing over the good faith deposit. There may be room for mediation before having to move forward with this part of the process. Again, check with your agent for contingency specifications.

Stay connected,
Renee Kische
Keller Williams-Hollywood Hills
323.377.7976
renee@bestLAliving.com
0 votes Thank Flag Link Thu Dec 1, 2011
Yes you could still cancel before the bank funds the loan, but you may lose your deposit if you release your contingencies.
0 votes Thank Flag Link Wed Nov 30, 2011
Spencky,
Wow! That's a rough spot to be in.If you want to back out simply because you've changed your mind or have cold feet,I suggest taking a deep breath. You've spent a lot of time looking,you find the perfect match,you're at the finish line....what changed?
If there is a major issue ( job loss,death in family) get your realtor and your loan officer on a 3 way immediately and talk it out.They may be able to help you understand the financial consequences of the cancellation as well as put you in touch with a RE attorney to sort it out. Or talk you off a ledge if your nervous about the life change you're making.
I hope you are able to resolve the matter today! Good luck out there-
Kenya Costa ABR,SFR
KW los feliz
323.300.1115
Thelahomegirl@gmail.com
Web Reference: http://lahomegirl.com
0 votes Thank Flag Link Wed Nov 30, 2011
Are you getting buyers remorse? At this point the only way you could pull out is if the bank did not fund your loan because we're assuming you already received a commitment from your bank so you've satisfied that aspect of your contract. Once that has been completed and provided to the other party you're essentially on the hook. If there is another reason why you're looking to pull out, I would recommend you speak to an attorney. Good luck!

Marco Gomez
NYS Associate Broker
Keller Williams Landmark II
Serving Queens, Nassau & Brooklyn
0 votes Thank Flag Link Wed Nov 30, 2011
Homebuyer,

Depending on how far along in the process you are you may back out but you will most likely not be entitled to your deposit back. You may be losing a lot of money too. Why would you be considering backing out now? Best, Joshua Rabinovitz.
0 votes Thank Flag Link Tue Nov 29, 2011
I wonder what papers you haven't signed, you seem like you are almost there. I'm sure there will be negative consequences to you pulling out at this stage both from the seller and possibly the brokers involved; read your contract.
0 votes Thank Flag Link Tue Nov 29, 2011
spencky-
What are the papers that you have not signed?

Once your loan is in line to be funded, you can still contact the lender directly, specially the funder, and state your reason to stop it.

Doug Perez
(323) 285-8864
Web Reference: http://cashrealty.net
0 votes Thank Flag Link Tue Nov 29, 2011
If you feel, you need to back out, you should see your contract to make sure that the loan contingency is not removed, otherwise, you will get into a situation with the seller that he will not release your 3% deposit and then you need to go to arbitration, and it will get messy.

Tammy Behnam
310-266-1102
http://www.tammybehnam.com
0 votes Thank Flag Link Tue Nov 29, 2011
Are you past the contingency phase yet? If not you can pull out. However, if you've signed off on all the contingencies and you're just having second thoughts you may have some issues.
0 votes Thank Flag Link Tue Nov 29, 2011
Spencky -

You can do anything you want to do. There may be consequences.

Breach of contract is a legal determinant to whether or not your deposit is at risk.
The attorneys/mediators/judge will help you and the seller decide if you were acting in good faith and whether or not your cancellation is a breach of contract. I would highly advise consulting with a real estate attorney before canceling. The outcome will most likely be determined by contract, good faith, and whether or not the seller wants to pursue the issue or get back to the market and find a true buyer. Make sure you know your options with professionals that can review specifics to your situation.

Good luck,
CJ
Web Reference: http://TalkToCJ.com
0 votes Thank Flag Link Tue Nov 29, 2011
Hi Spencky,

Why do you want to pull out at this point? Have you discussed this with your agent?

Best wishes,

Elva Wormley
C2 Financial Corporation
0 votes Thank Flag Link Tue Nov 29, 2011
Dear Spencky,

Ouch! As mentioned, you should expect the seller to go after your deposit money unless you have a very good reason for canceling. Call the Escrow and/or Title company right away to stop the funding or you will own the house. Think seriously about your decision before moving forward because there will be consequences if you cancel.

Angie Simpson
Coldwell Banker
0 votes Thank Flag Link Tue Nov 29, 2011
you seem to be suffering from that all too common thing known as buyer's remorse...we all second guess our decisions! Having said that, you signed the contract of your own free will, and have now engaged the services of several professionals to close the deal..the title company, the bank, the attorney, etc.....At a minimum expect to lose your escrow deposit, which would seem to be entirely appropriate base on the information provided here!
0 votes Thank Flag Link Tue Nov 29, 2011
Unless you have a valid reason to pull out due to some unfortunate incident that happened to the property recently or the area surrounding it (ex. murder,gang activity,environmental hazard,alien settlement), then you are at risk of losing your entire deposit. It is not fair to all the people who worked on your purchase and have you back out at the very last minute like a runaway bride. The person who will get affected the most is the agent since none of the deposit money will be split to him/her for time spent working with you and time wasted working on that deal when there could've been other clients they can actually close escrows with. When you buy a property and open escrow, you are allowed a certain time period to back out before risking losing your deposit. Honestly in my opinion, you went forward to open escrow on this property and are almost at closing so you should stay the property and deal with it later in selling it or leasing it out. You don't open escrow just to kill some time. If someone not involved in this transaction is giving you negative ideas about the property then they are just trying to bring you down to their level and not purchase a home. If losing your entire deposit is not a problem then cancel the deal and find another agent who will take a chance losing other potential clients they could've spent time on while working with your deal that is a "Ben Affleck" type of escrow. Otherwise stay with the course, close escrow, and sell it when you know you will make an acceptable amount of equity on the property. Good luck!
0 votes Thank Flag Link Tue Nov 29, 2011
Yes, you could pull out, but expect to lose your good faith deposit & for both agents to sue you for commission. You can't just wait to 24hrs prior to closing & then back out & not expect repercussions.

Unless: The house burned down, a jet flew into the house, there was an earthquake yesterday that only hit the house you're about to close on etc.

Are you getting cold feet? If your loan is funding this means you CAN qualify.

You should direct any & all concerns you have right now to your buyer agent.

EmilyKnell1@yahoo.com
562-430-3053 c
Realtor Since 1996
Main Street Realtors
0 votes Thank Flag Link Tue Nov 29, 2011
If you still happen to have a contingency in place then you could pull out and keep your deposit less some incurred costs for escrow/title/appraisals etc... depending on your arrangements with each. It is unlikely that you still have the contingencies in place this far in but it is possible. Do you recall if you signed the contingency release form? Why are you wanting to pull out at this late stage? If you have just learned something about the property that was not previously disclosed and is material in nature then you may have something, otherwise, congrats on your new home!
0 votes Thank Flag Link Tue Nov 29, 2011
Stop the funding WIRE asap. Yikes! why so late in your decision?
Speak with the Title Company whom is waiting for the wire to fund and record. They may be able to give you some direction or advice.
You will lose your earnest money. Call a local Real Estate professional in your area to find out the"possible" legal ramifications of such an action.
0 votes Thank Flag Link Tue Nov 29, 2011
After coming this far, why on earth would you want to?
You will be losing the money you've spent on Inspections and your Deposit too,
not to mention the time, gas and stress, to both you and your Agent (who will surely cry!)
Also, the Title Company will charge you for their services. (you betcha!)

Good luck and may God bless
0 votes Thank Flag Link Tue Nov 29, 2011
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