i put down a deposit to hold the property but i want to cancel, i didnt approve the loan. can i get my money back?

Asked by Wayfarer11, 93036 Tue Apr 5, 2011

they asked for a money so that they can hold the property for us and now they are telling me that its part of the deposit and i cant take it back because it's on escrow but i didnt even approve the loan. can i get my deposit back?

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6
Lance King, Agent, San Francisco, CA
Wed Apr 6, 2011
wayfarer,

You mention escrow, so presumably you put your deposit with a title company. If that's the case, the way it works is this:

Buyer or buyer's agent notifies the title company they want to cancel the escrow and get their deposit back. The title company then sends out cancellation instructions to buyer and seller for signature. If/when both parties sign the title co can release the funds. The title co is a neutral third party who will not adjudicate a dispute, so if the seller refuses to sign you will have to use the dispute resolution as outlined in your purchase contract.

If you follow up with more details I might be able to offer more specific advice.

Best Regards,

Lance King/Owner-Managing Broker
lance@fixedrateproperties.com
415.722.5549
DRE# 01384425
0 votes
John Arendsen, Agent, Leucadia, CA
Wed Apr 6, 2011
Who's "They"? Are you even using a real estate agent/broker in this transaction or are you dealing directly with the seller? Did you actually even open an escrow? Your question is a little vague. If you aren't going through a licensed RE agent/broker and you turned your money over directly to a seller you may have a problem.

If you're working through an agent/broker that you contracted with I can't imagine that they would be that difficult to deal with. However, if you're working through the sellers agent they have a fiduciary responsibility to protect their client but they also have a duty to be fair and honest with you.

But like some of my professional associates are saying you do have a right to cancel within your 17 day due diligence period providing you didn't waive that right somehow.
0 votes
Eliseo Cisne…, , Oxnard, CA
Tue Apr 5, 2011
Hi, I have a question for you. Who didn't approve the loan? Was it the bank or you that didn't approve the loan? I just want to clarify. Your agent should have explained the contingency period of the transaction which is the period where you as the buyer must do all of your inspections of the property and assure the financing of the property. Once that contingent period is over than you as the buyer may risk loosing your deposit if you decide to cancel. However, once the contingency period is over you must sign a removal of contingency document removing all contingencies. If you signed document and then cancel you may lose your deposit. If you didn't sign that document and canceled then you should be able to get all of your deposit back. On all transactions where I am representing the buyer, I make sure the loan has been approved before I remove the loan and appraisal contingency. I will remove the inspections contingencies but not the loan or appraisal like I just explained. If needed I will request an extension of contingencies for those items. The reason why I asked what type of financing your were obtaining is because with FHA financing you may be able to get your money back. However, you may have to fight for it. I am surprised your agent didn't explain that contingency period and what must be done when running into the contengency deadline. Why didn't the loan get approved? Was it due to appraised value, income, credit scores or credit history? If it was due to the appraised value and you did FHA financing, then you will get your deposit back because the Real Estate Clause which must be signed by all parties ageeing that if the property comes in less than the purchae price you have the right to cancel and not risk your deposit. The best thing for you to do is talk to your agent and make sure he explains everything to you and fight for your deposit if you signed off on contingencies. Good luck!!
0 votes
Jerry Current, Agent, Pasadena, CA
Tue Apr 5, 2011
Wayfarer11,

Did you remove your loan contingency? Did you sign a form that said you did? If not, than you should be able to get your deposit back. You should ask your agent about your contingencies if you are not sure. If you did not remove your loan contingency then send a written cancellation letter to the escrow company and request your deposit be returned. If you do not get your money back, you need to call the Department of Real Estate and file a complaint an/or hire an attorney.
0 votes
Barry Shapiro, Agent, Camarillo, CA
Tue Apr 5, 2011
Wayyfarer11,
Your Buyer's agent has a fiduciary responsibility to you to explain your options throughout the transaction. Where are they this evening? BTW: If you have already removed your contingencies, then your EMD is legally belonging to the seller. However, assuming you opened an escrow, BOTH parties must agree, in writing, to the disposition of the funds (or via a court order to escrow). Good luck!
0 votes
KARIN ZELLER, Agent, OXNARD, CA
Tue Apr 5, 2011
Dear Wayfarer, How far into escrow are you? IF you are within your 17 days per the Purchase Agreement, then you should be able to get your deposit back with no penalties. As long as you didn't alter the contrsact, sogned no paperwork that states the seller would be abe to keep your deposit, then you have every right to cancel & get ALL your monies returned.
0 votes
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