Home Buying in 95348>Question Details

Margaret Mas…, Home Buyer in Merced, CA

When you give a deposit to escrow and buyer wants out , can the seller sell the house to someone else when the deposit is still in question?

Asked by Margaret Mason, Merced, CA Thu Jul 1, 2010

Help the community by answering this question:

Answers

5
Jeri Creson’s answer
BEST ANSWER
The seller can continue to market the home for back up offer purposes until a sale is consumated. If the buyer indicates a desire to cancel the contract, the seller can accept another offer "subject to the cancellation of the previous escrow". Once the original buyer and seller execute cancellation instructions, the deposit can be released back to buyer according to the terms of their cancellation instructions or the underlying agreement.

While the matter is still unresolved, i.e. either the buyer or the seller has not signed the cancellation instructions, a cloud on the clear title of the property exists, which is the reason there are penalties in a contract for non perfomance and failure to comply with cancellation instructions when they are valid. Some buyers feel that they can "tie up a property" by refusing to perform or sign cancellation agreements, and some sellers refuse to sign cancellation instructions releasing the due deposit back to the buyer - however, both would do so at their own peril and risk of damages.

If the seller is refusing to release your deposit, you may need to speak with an attorney. It may be wise to file a notice lien on the property so that the seller could not, for example, open an escrow elsewhere and consummate a sale without any public record stating there is a cloud on title should this continue.

Good luck - and talk with an attorney sooner than later -
2 votes Thank Flag Link Thu Jul 1, 2010
Hi Margaret, You should consult your attorney regarding the deposit and the return.

And as I understand it, yes, the seller can take another offer if the buyer wants out. But, if you had te house taken off the market for some time and you caused the seller to now sell the house for less to another person., the deposit may be in question.

Again that is a thought of what could be in line.. You should contact an attorney regarding the return of the deposit funds
2 votes Thank Flag Link Thu Jul 1, 2010
Margaret,

If a cancellation of contract form has been signed by both parties, then the seller can begin marketing the property again. The cancellation of contract has specific items related to the release of the deposit so this should be the tool used to direct action regarding the deposit as well.

Hope that helps.
CJ
0 votes Thank Flag Link Thu Jul 1, 2010
If the original contract is no longer valid then yes. If a buyer or seller refuses to release funds section 14F of the California Residential Purchase Agreement Allows for Civil penalties if "no good faith dispute" exists. However it does not keep the property from being sold.

Best Regards

Eric Soderlund
Web Reference: http://www.ESoderlund.com
0 votes Thank Flag Link Thu Jul 1, 2010
This is one of the greatest all time questions......and one that no doubt, would largely depend upon circumstances but certainly one that would be best referred to an attorney for their review and recommendations.

best wishes,

Bill
0 votes Thank Flag Link Thu Jul 1, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer