I decided not to purchase a property after making a deposit on it. I used the standard offer form. I have requested my deposit back from the broker and he says he can not send me the deposit until the seller agrees. What are my rights here?
The first thing you need to understand is that an offer which has been accepted by a seller is a binding contract. There have been a number of cases where a seller developed seller's remorse after signing an offer and thereafter refuses to go forward with the transaction. In the cases that have been brought, the courts have enforced the offer as a binding contract so long as the essentials are present i.e., the purchase price, the deposit amount, the date for closing and any contingencies put in by the buyer. So the offer that you signed is in fact a binding agreement between you and the seller as to the sale of the property and neither the seller nor you have the unilateral right to void the contract. Usually the offer to purchase requires the signing of purchase and sale agreement which sets out the more formal terms of the transaction and also, very often, the offer has contingencies the most notable ones of which are the inspection, the financing and a review of condominium documents and/or budget. If a buyer after reviewing the condominium documents or the budget or the inspection concludes that the property was not what he believed it to be or the way it was represented, the buyer will normally have a right to terminate the offer and receive back the deposit paid with the offer. The offer form normally provides that if the buyer fails to perform their obligations under the offer that the deposit will become the property of the seller. That is the reason why the broker told you he cannot release the deposit to you because the seller may have a claim to the deposit in the event that the seller believes that you did not terminate the offer properly based upon the contingencies in the offer. I would suggest that you ask the broker to give you the contact information of the seller and contact the seller and try to meet with the seller to resolve the issue. Otherwise the only way for you to force the issue would be to bring a small claims action against both the seller and the broker seeking a return of the deposit that you paid with the offer.
If you have questions about this or any other legal matter, please contact Tom Bennett at (617) 531-6574 or tvb@barronstad.com.
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