How can I get my $5000 deposit back from seller?

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I live in philadelphia, PA. I placed an offer on a house because I was preapproved for a home loan. but the loan processor surprised me that they have to denial my mortgage because of my student loan. therefore, the bank want me to put at least 35% down or paid off my student loan. As my situation, there is no way i can have another $ 30K to paid off this unexpected amount since I am a first time buyer and only have 20% down and money for closing costs and a few bucks to fix the house. The agent told me my credit is great and the bank pre-approved me, so we had nothing hindering our house search,…. but Now the problem is the seller refuse to refund my $ 5000 deposit and even have an attorney send a letter to my agent saying that the seller is not going to refund my deposit and also ask for another $ 5000 dollars because I waste their time…. I am speechless, on the contract i am elected for mortgage contingency shouldn’t i get my deposit back? what is buyer’s rights? i have real estate agent, why they won’t be able to help me and do i have to find a lawyer by myself? please help, i am so panic! i will be really thanks for your kindness help and advice.

  1. Reply
    February 5, 2011 at 10:19 pm

    Call a law office and, then, in person, describe your situation. This worked regarding a $ 1000 car damage by means of a letterhead (law office). $ 5000 may be more difficult but at least the lawyer can describe your rights in the matter and your best course for recovering your money..

  2. Reply
    February 5, 2011 at 10:37 pm

    No, the deposit is a good faith deposit that says, “You don’t have to look at any other offers, because I want this place.” Unless you have getting financing under the contingencies, you are SOL. Now you may be able to buy some time with the seller to get other financing in order, but in general, you will be out of the money. Unless there is an outright fraud commited.

  3. Reply
    Expert Realtor
    February 5, 2011 at 11:26 pm

    Your situation is not difficult or uncommon and is an easy fix.

    You have the contract that states that your mortgage was CONDITIONAL upon approval.

    You are REQUIRED to provide the sellers with a letter of denial from your bank..not verbal, it must be in writing.

    If you have the mortgage contingency and the denial letter and the seller won’t give you your deposit back, then the SELLER is in breech of contract…you get an attorney to send the sellers a letter, outlining the terms of the contract and a demand to have the money back in 10 business days.

    If that doesn’t work, have your attorney to sue them…you’ll not only get your $ 5K back but you can also sue for your legal expenses.

    PS: Was the $ 5K by chance, only 1% of the sales price? If it was more, then get another Realtor next time, because that was too much to pay up front to start with.

    The seller’s attorney is blowing smoke up your butt and I highly suspect it’s a friend of theirs.

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