You will still be responsible for all inspections that you have authorized, and also if contract states buyers have to pay.
Sometimes the title company may charge for an escrow cancellation, and you may have to pay for that, if their title policy so states. However, you may be able to negotiate that with them.
Seller has to respond to cancellation within a reasonable period of time, otherwise they may be responsible for damages, and your contract may stipulate that-you need to say what the contract says.
Additionally, call the broker of the other agent, and ask him to clarify, and he can also help in resolving your problem. A lot depends how the contract reads, etc.
You should be able to get your deposit back after deducting for inspections, etc, that you have ordered.
It really depends on your contract so advice from an attorney of your choosing is the final word.
I see two problems with what you explain here. The seller has to be damaged in order to claim damages and this claim of rights should not be asserted by an agent but by the sellers attorney. Where is YOUR agent in this process?
Secondly, this sounds like a used car sales. Salesman to sales manager "Sam he is willing to pay the $750."
Manager "Go back and hit him up for the floormats and see what he says, next we'll ask for something for the undercoating. We'll get all his money eventually..."
Going back and forth like this verbally is a lsoing proposition. Sounds like the agent double ended the home and it sounds like you are getting the short end of the stick. In any event, you need representation. Get it quick before you sign anything.
Generally, whichever party orders and authorizes an inspection is responsible for the cost of that inspection unless it is stipulated otherwise in your contract.
If you backed out before you released your contingencies, and most importantly if the reason for backing out is because you don't have loan approval, then you should be able to get your deposit back.
If you're using a standard CAR (California Association of Realtors) Cancellation of Contract, Release of Deposit and Joint Escrow Instructions form, it states "A party may be subject to civil penalty of up to $1,000 for refusal to sign such instructions if no good faith dispute exists as to who is entitled to the deposited funds (Civil Code 1057.3)" So yes, if the seller refuses to sign, the seller may be penalized for up to $1,000.
I just had buyers back out of contract on one of my listings. Because they did it before they released their contingencies, the seller agreed to the cancellation and the buyers are getting their deposit back. And because they ordered (and paid for) pest inspection and property inspection, I asked the buyer to release those inspections to the seller so that we can use them as part of our disclosure package.
Second, cancellation charges are not your responsibility and your agent and his/her broker need to get involved at this point and handle it.
This sounds like a strong arm tactic and I would definitely get an attorney involved if this presses further. The only other solution would be for you to find another loan officer, but with this kind of seller I do not know if the risk warrants staying in the transaction.
Contractually Shan is absolutely right, there is no penalty for canceling the contract.
Our contracts in Las Vegas all have a loan contingency in them, that if the buyer doesn't qualify, the EMD is refunded. Not being able to qualify is not bad faith.
Why did the seller pay inspection fees? Having an inspection done is usually a buyer's cost. Again, its usually something you pay for as the buyer to make sure the house is in the condition that the seller is representing it is.
What cancellation charges would those be? Can he provide an itemized list of these cancellation charges? Who is charging them?
You need to speak to your agent, and again may need an attorney to review your contract.