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khome · Apr 14, 2008, 02:34 PM

Hello, my buyer, a canadian buying a home in California, demanded a simultaneous 14 day loan contingency and escrow close. The buyer was approved for the loan but the closing monies never transferred to escrow because bank refused to send loan docs before closing monies was transferred to US account. Client refused to send money before receiving sample or draft loan documents. Bank maintains they do not ever send out draft documents. Buyer does not seem to want to move forward in good faith and using this as excuse. Does the seller get to retain his 30K deposit.

progunr · Apr 14, 2008, 02:41 PM

If the transaction is not completed, I do not see how the deposit could be legally retained.

I have no knowledge of Canadian law but with the transaction taking place in California, I'm not sure if that makes any difference?

What specific language is in the purchase agreement or document that the deposit is attached to?

What ever is in writing will usually prevail, but, not in every case.

Fr_Chuck · Apr 14, 2008, 02:45 PM

This is a US sale, so Canadian law has nothing to do with it, and yes, the buyer gives up his deposit if the loan is approved but the buyer refuses to do what is required to finish. Thiis is why they put the deposit down to force them to follow though with purchase or lose their deposit.

Since it is 30,000 and I am sure you are using a real estate attorney anyway, why not do this though them

tlhen51 · Apr 14, 2008, 07:09 PM

Is this an american bank? A good faith estimate of closing costs is always sent out prior to closing a home loan. If the bank is refusing to send the good faith estimate before funding the loan that is wrong. You client should be able to get his deposit back if the lender is refusing to fund the loan then he didn't get his financing. This should have been part of the contract as a contingency. I would ask a real estate attorney. I think your buyer is due a refund.