I was under contract to buy a MLS house in St. Louis, MO but the deal fell through because I was unable to obtain financing. There was a clause in the contract that stated if I was unable to get financing, the deal is scrapped and I will get my $1000 earnest money back.
I was preapproved for the loan but after further review, the loan company decided I took too many deductions in my 2004 taxes and used that against me. I faxed the denial letter from the mortgage broker before the deadline on the contract. The sellers agent claims that I should have known I would not qualify for the loan which is completely untrue.
But the sellers agent and sellers of the house still has not signed for the release of my earnest money. How do I get it back? Do I take him to small claims court?
I'm not sure about the law in your state but in Texas your earnest money should still be in escrow awaiting the completion of the transaction. The good news is that the sellers can't get the money either, unless you sign an earnest money release with them as the benifituary. The bad news is that they could switch title companies when they have a new buyer leaving your money in limbo. What I would do is to Invite everybody to a small claims law suit party. The seller's, the seller's agent, the mortgage broker, and my agent. But first I would threaten in writing via certified letter of my intentions allowing a reasonable time period (2 days) for reply then forward my complaints and documentation to each of the parties regulator commission along with the Attorney General of you peticular state. They can't keep your money. $1,000 bucks is a lot of money!
live long and prosper!
The first answer to your question is correct (see above.)
But why are you asking here and not your Realtor? You are a buyer, it doesn't cost you anything to have a Realtor working for you, so you have one, right?
If not, this is a good example why anybody buying real estate should have a professional working for you. There will be much more complicated questions and problems down the road, so it's just silly not to have a Realtor, especially if it doesn't cost you anything!
Originally posted by molarband:
But the sellers agent and sellers of the house still has not signed for the release of my earnest money.
Have you talked to the Broker? Real estate agents work for brokers. A broker is like the head agent of a company.
The broker will generally be more reasonable than many agents. Some agents are real boneheads but the broker doesn't want to put his license at risk. The broker is also likely the one actually holding and responsible for the deposit.
Guys, the original post here is three and a half years old. Pretty sure the OP either got his money back or its too late.
hahahaha, talk about going through the archives!
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.