I'm a buyer. I had a pre-approval letter but couldn't get Loan, How Can I get my Escrow Deposit back?

Asked by Ali, Canoga Park, CA Tue Mar 10, 2009

We found condo, received pre-approval from countrywide for a FHA loan(3% Down) & it went to escrow, (30Day term) we put $7500 deposit. Appraisal & inspection was ok. Everything went real smooth till bank started to give us hard time. Everyday asking for something new (which we provided them& finaly yesterday rejected my loan becouse of the ratios??? My broker even tryed different lenders & I told her I will go up to 10% down. Seller's agent gave us 15 days extention but right know it lookes like we can't get the loan. How can I get my deposit back?

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, ,
Thu Jun 18, 2009
The only way to get your deposit back is to ask from the seller the money. You had 17 days to perform and you didnt, the seller then gave you 15 days to perform and you still didnt. So the only way is to ask your seller.
Next time just hire a better Loan Officer because if he would do his job right this wouldnt happen.
Web Reference:  http://homesinsale.com
0 votes
Patti Philli…, , Carlsbad, CA
Sat Mar 14, 2009
Ali, I always wonder why people have questions like this and their agent hasn't taken time to discuss it with them and walk them through the process, problems and solutions.

As the people below said, if you haven't removed the loan contingency, there shouldn't be any sort of problem. If the contingency was already removed, and you have a denial letter 99.9% of the time the other side can see that there is nothing you can do, and they will cooperate with you.

I hope your Realtor is taking a proactive stand and helping you through all of this. If not, go above them to their broker or manager and ask for help.

Patti Phillips
"Advice You Need, Attention You Deserve"
0 votes
Doug Francis, Agent, McLean, VA
Tue Mar 10, 2009
Okay, you need to return to your contract. My contract has specific language for FHA loans stating "ifPurchaser receives a written rejection for the Specified Financing and Delivers a copy of the written rejection to Seller, then this Contract will become void." Then look through the contract where it discusses when it is a "void contract." It should say that all parties will sign a release and the deposit will be returned to the Purchaser.
Do a little reading of the contract in your FHA financing paragraph and then the void paragraph. Good luck!
-doug francis ABR
0 votes
Mikem, , 01803
Tue Mar 10, 2009
Ask your agent to get it back. So long as you had a mortgage contingency in the Purchase & Sale it shouldn't be a problem.
0 votes
Stacey White, Agent, Elizabeth City, NC
Tue Mar 10, 2009
The same lender that gave you the prequal letter should be able to give you a denial letter. This is ENOUGH to termination and have your earnest money deposit returned, as long as financing was contingency of the contract.
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