Seller refuses to release the earnest money. - Posted by Mike

Posted by Melissa-So. Calif. on July 30, 2001 at 20:26:11:

Well actually it had nothing to do with the actual housing deal. It was a promissory note stating that the agent that took my mom’s $700 would paid it back to her at the close of escrow. It was actually not even apart of the deal… Now I know that was a bad move!!! :O(

Seller refuses to release the earnest money. - Posted by Mike

Posted by Mike on July 20, 2001 at 11:06:03:

I offered to purchase a house which my inspector
latter found out That house had extensive damages
and other problems. However, I put two clauses to
protect me.
1)- ?. If the cost of repair and replacement exceed $500 , then buyer has option to terminate the contract
and all earnest money return to buyer.
2)- Seller agrees that buyer to walk- thru inspection of property , and satisfactory approval of subject property , within 3 days before closing

The cost estimate of subject property per general contractor is over $1000, Therefore, I executed my
option and terminated the contract.

The problem is, The Seller refuses to release the earnest money , and He Said, he repaired all necessary work less than $300. I said OK. Let me Inspect and verify
it ( accordance of caluse #2), He said , NO. I do not
Let you get close to my house.

OK. Gang, How do you all deal with such ?Idiot?.
And get my $1500 Earnest money back.
Is there “any other ways” to colect my earnest money
without going to court.

Thank you all,

My agent actually stold $700!!! - Posted by Meliss

Posted by Meliss on July 22, 2001 at 16:06:46:

My agent actually stold $700. of our money right out of the escrow office, (which was in the same building as the real estate office)!!! It’s been 3 months and we haven’t seen a dime of the money. The broker said “we just didn’t understand”, but he’s lying also…

I do not trust agents as far as I could throw them!!!

Melissa - Ca

Re: go right to court… - Posted by SueC

Posted by SueC on July 20, 2001 at 13:56:57:

Don’t bother with any letters and waste more time. Go right to small claims court, it’s easy, you can do it yourself.

I don’t know where the realtors get off doing this s**t anymore, I had one try to pull the same thing with me. I will never again give the listing agent the deposit unless I absolutely postively have to have the property. I thought they were under an obligation to return it if the contingencies kick in, but they don’t, all they have to say is it’s in “dispute” and since they aren’t arbiters of the legality of the contract (more BS) they can sit until the court decides.

That’s why I wouldn’t waste any time with lawyers, letters, etc.

Re: Seller refuses to release the earnest money. - Posted by Steve

Posted by Steve on July 20, 2001 at 12:34:04:

Call your state agency that regulates Realtors. In Florida a Realtor is required to notify the Real Estate Commission when an earnest money deposit is in dispute. Further, the realtor usually must submit earnest money in dispute to the Courts or the Real Estate commission. It is definitely not the realtors money. Also, the Realtors escrow account is usually very heavily regulated by the State.

Good luck.

Re: Seller refuses to release the earnest money. - Posted by Dr. Ralph Werner

Posted by Dr. Ralph Werner on July 20, 2001 at 12:04:36:

Here is what we do at Werner, Werner and Associates LLC here in Michigan when we flip properties…

  1. Let your sellers and their representatives know that you have to pay for such expenses as appraisals, credit checks, pest control, survey etc., and as a result this action consititutes a non-refundable good faith money by doing so! If this does not work then…

  2. Use the subject to clause on check method…Write out your check for $100 or more but put wording on the back of the check in the endorsement area that states " Subject to contract on 123 Forthright Street" Then write into the purchase contract under “other terms” “Earnest money check shall not be cashed until closing.” The subject to clause makes the check a non-negotiable instrument not able to be cashed by your bank. Also never make out the check to the realtors escrow account or the sellers name. ONLY MAKE IT PAYABLE TO THE TITLE COMPANY!

Make sure the title/escrow officer understands this stipulation very clearly!

God Bless
Dr. Werner

Re: Seller refuses to release the earnest money. - Posted by Stacy (AZ)

Posted by Stacy (AZ) on July 20, 2001 at 11:22:11:

Did you give your earnest money directly to the seller? If so, don’t ever do that again (exactly for this reason).

Also, this is one reason I usually put only $100 into an earnest money deposit. I’m presuming this is a FSBO. I’d have put more down if it was through a realtor, most likely. Probably $500.

I would start by getting my lawyer to send him an official letter, quoting the law, and stating that a law-suit will be forthcoming (with treble damages and attorney’s fees). This can go a long way toward helping a seller see the light.

If that doesn’t work, I would say a law suit is probably the way to go.

Stacy

Re: My agent actually stold $700!!! - Posted by JohnBoy

Posted by JohnBoy on July 23, 2001 at 14:07:01:

The broker didn’t understand what???

I assume you have a copy of the paperwork showing you gave the agent $700??? That’s all you should need for the agent’s broker to understand anything! The broker needs to give you your money back and file criminal theft charges against his agent. I believe $700 would fall under a federal offense of grand theft!

The broker is responsible for their agents. File suit in small claims court against the real estate company the agent works or worked for!

Good info., Dr. W. !! [nt] - Posted by SusanL.–FL

Posted by SusanL.–FL on July 20, 2001 at 13:54:52:

nt.

I’m curious - Posted by Jesse (MA)

Posted by Jesse (MA) on July 20, 2001 at 11:48:01:

Stacy,

If this is a FSBO how would you go about putting the earnest $ out of reach of the seller. Should an escrow co./lawyer already be lined up on the investor’s end?
Thanks! Jesse (MA)

Re: Seller refuses to release the earnest money. - Posted by Mike

Posted by Mike on July 20, 2001 at 11:45:19:

Thank you Stacy(AZ),
this contract is thru a local Real Estate Agent. Their
BIC said, I have to go thru small claim court to collect the earnest money.

thanks,

Re: My agent actually stold $700!!! - Posted by Melissa-So. Calif.

Posted by Melissa-So. Calif. on July 24, 2001 at 20:39:38:

Well, the ironic thing is that when he took that $700 out of escrow, he also took the signed promissory note-the only copy- and no one knows where it is!!!

We were so trusting and figured the promissory note would be safe if it was kept in escrow!!!
HAHAHAHA WRONG!!!

Melissa

Re: I’m curious - Posted by Stanley

Posted by Stanley on July 20, 2001 at 11:57:03:

Yes. Write the earnest money check to the title company.

Re: Seller - Posted by Stacy (AZ)

Posted by Stacy (AZ) on July 20, 2001 at 12:18:30:

Oh, it isn’t a FSBO. Well, unfortunately, I think you’re going to have to go to small claims court. Still, a letter from your lawyer may shock the seller into reality, and I would definitely try it. You will win this case, but make very sure you document everything so you have evidence to present to the judge. Get your contractor’s estimate in writing, and get the seller’s refusal to allow you to inspect IN WRITING.

Stacy

Re: My agent actually stold $700!!! - Posted by JohnBoy

Posted by JohnBoy on July 24, 2001 at 21:29:01:

What does a promissory note have to do with putting up $700 cash in escrow? A promissory note would onlt pertain to making payments on money promised to pay, not money already paid.

You should have a signed purchased agreement that states the price you will be paying for the home, the terms, and the amount of any earnest deposit.

If you used a promissory note then that would mean you put up the note itself as a promise to pay money later. It wouldn’t have anything to do with putting up any cash as a deposit.

As far as any purchase agreement that was signed by you and the seller, you should have a copy of that, the seller should have a copy of that and the agent should have a copy.

Are you saying you entered into a purchase agreement that you signed and the seller had signed and no one has a copy of it except the agent???