Diane Wheatley

In other words, are you saying that the closing cost and payment incentive package the builder was offering was worth more to you than the price reduction on the house? Please clarify so we can help you.

Diane Wheatley, Broker
diane @moveupproperties.com - Sun Nov 16 2008, 17:38

Dear RR, If both parties initialed the liquidated damages clause in the purchase contract, both buyer and seller must initial this clause for it to have full force and effect, you are agreeing up front at the time the offer is accepted that all parties agree to pre-defined dollar amount of money to be held in escrow in the event the buyer should default on the terms of the contract. Those terms state that "If Buyer fails to complete this purchase because of the Buyer's default, Seller shall retain, as liquidated damages, the deposit actually paid. It goes on to say that the dollar amount retained shall be no more than 3% of the purchase price and any excess shall be returned to the buyer through mutually signed release instructions, judicial decision or arbitration award.

If you agree that you defaulted then the amount of the deposit actually paid is the dollar amount that you have already agreed to pay the seller. If you agreed to pay the seller 3% of the purchase price as liquidated damages, then that amount is what should be paid. If your initial deposit was less than 3% then that amount is the amount you have agreed to pay.

I'm sorry to that you had to wait a costly 6 months but I agree with the fact that it makes sense to give up money on one deal to negotiate a better deal on the same house which will cover your loss on the first house and still allow you to come out ahead. Are you sure you do not have a clause in your purchase agreement that would allow for you to cancel without forfeiting your deposit? Did you put a clause in the contract regarding the length of time allowed for the seller to provide you with the final permits for occupancy? Obviously you are not expected to wait indefinitely.

Regardless, don't pay more than the deposit you actually paid up front and good luck on your next new home!!

Diane Wheatley, Broker
diane@moveupproperties.com - Sun Nov 16 2008, 01:48

Of course not. Everything is negotiable - to a point of course. There are some closing costs that a buyer is not allowed to pay for instance using FHA financing. And a seller will most definately pay the buyer's closing costs on a VA loan. Unless it is a certain loan program being offered that I am not aware of, the seller is allowed to pay the buyer's closing costs as part of the negotiations. Every transaction is different. Without knowing the terms of your transaction that is the safest answer I can provide you.

Good luck! Ask your real estate agent why she is saying this and have her show you in writing how she is supporting this theory. Do some investigating online or with other lenders and you'll find the answers you need.

Diane Wheatley, Broker
diane@moveupproperties.com - Sun Nov 16 2008, 01:21

An inspection can range from $250.00 to $500.00 depending upon how extensive the damage is or how large the house home is. Not all mold is hazardous but many buyers will want it removed no matter what type, kind it is. Now that is where the high ticket costs come in. I sold a house last year that the buyer demanded mold remediation work performed at the seller's expense prior to close of escrow. The homeowner was able to use their homeowner's insurance to help cover a portion of the expense but I'd say the final tab came to nearly $5,000 after the deductibles were paid. Good luck.

Diane Wheatley, Broker
Move Up Properties Real Estate Brokerage
diane@moveupproperties.com - Sun Nov 16 2008, 01:13

Back out now! If you are within your time periods outlined in your purchase contract you have your full 100% right to cancel and make a claim for your deposit. The bank can take forever and a day to get back to you so don't rely on their competence in contract deadlines. Check your purchase contract to see what time frames you agreed to complete your contingency items by and if your are within your time frame allowed to cancel, then cancel. You do not need to wait for the lender (unless your contract was written in such a way but I doubt it). No more waiting!! If you are sure you'd like to cancel then the sooner the better. Best of luck to you.

Diane Wheatley, Broker
Move Up Properties Real Estate Brokerage
diane@moveupproperties.com - Wed Nov 12 2008, 00:00

You are right regarding the terms of the contract. Not only does it not list a timeframe that the seller (lender) must respond but he does not have to respond at all. If you not satisfied with the condition of the home and truly want to cancel your escrow then have your agent prepare cancellation instructions based upon your inspection contingency and you should be able to collect your deposit back within a reasonable amount of time. Good luck! - Fri Apr 4 2008, 13:21