Home Buying in Orange>Question Details

Nayem, Home Buyer in Jamaica, NY

i signed short sale house and i put 10000 dollar deposit against that house, finally bank deny my loan, but seller attorney tryin to keep 5000 dollar

Asked by Nayem, Jamaica, NY Tue Feb 5, 2013

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Amber Faruqi’s answer
Absolutely do not let them keep this money a bank that declines the short sale does not keep that money nor can the selle keep it. I hope your contract had a " subject to short sale clause" if so you can get out of it if not then keeping your down payment is simply a way to get paid for their time and its not legal.
0 votes Thank Flag Link Tue Feb 12, 2013
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0 votes Thank Flag Link Fri Apr 10, 2015
Have a real estate attoryney (yours) look at the contract and review your situation
0 votes Thank Flag Link Sun Mar 10, 2013
Hello Nayem.

Your purchase agreement has a loan contingency. If the buyer fails to secure a loan for any reason after the contingency period expires the seller does retain the right to keep the buyer's deposit.

Why was your loan denied? Did you secure a preapproval prior to enetering nto the purchase agreement?

Perhaps you can try and secure a loan with anothe rlender and keep the deal alive.


Best of Luck to you

Kawain Payne, Realtor
0 votes Thank Flag Link Sat Feb 9, 2013
If you did not get your loan with in the contingency period. The seller has every right to keep your deposit. It is written into the standard contract.
Your best bet is to plead with the seller and or have your agent plead on your behalf. In this market, they may already have another buyer ready to go into escrow. In that case they may be willing to release your funds to you just to move on.
That said, the importance of having your loan and funds in place prior to starting to search for a property cannot be stressed enough.
Please speak to a qualified loan officer. Ask them how many purchases they have completed? Also, when did they complete the transactions? Today is a much different market than it was two years ago...and so on...
Because some loan officers are familiar with refinancing, but have no clue how a purchase works. They should ask you for loan conditions [pay stub's, W2's, bank statements, etc...] prior giving you a loan approval letter.
If you don't have a loan officer to work with. Any Realtor you are working should have several on their contact list.

Good Luck!!
0 votes Thank Flag Link Wed Feb 6, 2013
It will depend if your purchase was contingent upon getting a mortgage andif you stayed within teh deadlines given. you should check your contract. You should also have your buyer agent assist you, if you bought without an agent,m you may want to contact a lawyer to review your contract
0 votes Thank Flag Link Wed Feb 6, 2013
Hello Nayem;
It all depends how far into the transaction are you. Did your Short Sale Lender approved the short sale already?
If your Short Sale Lender has approved your seller's Short Sale and you are passed your time frame indicated in your contract for your loan contingency, then the seller is right. I am hoping you can reason with the seller.
Please talk with your agent and have her/him sit down with you and read the contract for more detail and possible legal remedies.
Best of Luck
Shadi Kian
Broker
0 votes Thank Flag Link Wed Feb 6, 2013
Hi Nayen,
If the property is located in NY, to us New York is an attorney state (for loans) that means that if you are doing a loan in NY an attorney will be in the loan transaction.
You must read your loan documents to see where in that documents it states that the attorney will keep portion of the money or call New York BAR and explain your issue.
I can tell you that the atorney did the right thing (based on signed documents), it is very hard for an attorney to lose his license over $5000 (read your documents, get counseling from the NY BAR).
0 votes Thank Flag Link Tue Feb 5, 2013
I asked NY or CA because Nayem's profile says Jamaica NY, but the question was posted in Home Buying in Orange (which could be Orange County CA, NY, FL, etc)

Why was there an attorney involved? Was the Attorney negotiating the short sale or if the purchase was in NY, they use attorneys to close sales there. If the attorney was negotiating the short sale, did you sign something that the attorney gets paid for their services no matter whether it closes or not?
0 votes Thank Flag Link Tue Feb 5, 2013
If I read this correctly you put in an offer on a property in CA that was a short sale. They had you put $10,000 into escrow for the purchase, the bank accepted the short sale but you did not qualify to get a loan for the purchase. If that is the case I can't believe that the attorney can demand payment from your EMD (earnest money deposit). It is most likely that there are other buyers in line to buy the home and the lawyer will still get paid by the next buyer in line. It is best to read over the details of you purchase agreement and any short sale addendums, etc that you signed to see where you stand.

Good luck, I hope this helps,
0 votes Thank Flag Link Tue Feb 5, 2013
Laura is completely accurate!
0 votes Thank Flag Link Tue Feb 5, 2013
Is this property in New York or California ???
0 votes Thank Flag Link Tue Feb 5, 2013
The CAR purchase agreement clearly states time is of the essence. It is very important that you choose a Realtor to help you follow contract guidelines. When your lender does not approve your loan and you are past your 17 day period or you have removed all your contingencies the seller may have a right to keep it.
I would seek legal council.
0 votes Thank Flag Link Tue Feb 5, 2013
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