Posted by Mark-NC on November 10, 2000 at 20:56:18:
Posted by Mark-NC on November 10, 2000 at 20:56:18:
I want my money back… - Posted by Paul
Posted by Paul on November 08, 2000 at 19:58:30:
I recently put an earnest money deposit of $1000 on a property I was going to purchase. I had a couple of contingencies in the contract and the sellers accepted my offer. When it came time to close, a couple of the contingencies weren’t met, so the deal was off. I went to the listing broker and said I wanted my $1000 back. The broker had me sign a form and said the seller had to sign it too, then I would get my deposit back. That’s been over 3 weeks ago, and the broker said they can’t track down the owner to get the paper signed. I asked them if my money was in an interest bearing account and they said no. I said I was tired of waiting. What recourse do I have in order to get my money back?
How to get it…(next time, if not this time) - Posted by Eduardo (OR)
Posted by Eduardo (OR) on November 09, 2000 at 14:52:15:
JPiper and Carmen have given good responses below. I just want to add that you must obtain and KEEP all copies of the earnest money agreement you signed and any additional addendums or changes, including your written rejection of deal based the contingencies which were not met. This last is very important. If, for instance, you had a contingency regarding an inspection (such as for pests, or roof, or well, or whatever) in the earnest money agreement, you must, within the appropriate time frame, reject the deal in writing based on your non-approval of the inspection results. For example, if the earnest money agreement said something like, “This offer conditional upon buyer’s approval in writing within five days of receipt of an understructure inspection report by ABC Termite Inspectors, Inc. or this transaction is null and void and all earnest moneys shall be returned to buyer,” then you should not just not respond, but actually date and sign a rejection of the report within the five days and retain an initialed copy (by the Realtor, if nobody else) in your files. In addition, you need to keep the inspection or test results themselves. The reason for doing this is because in real estate deals in all states only documentation in writing is legal and acceptable (unless you want a long, drawn out, expensive battle based on verbal discussions [which can be disputed easily] and disappearing or reticent witnesses). Any attorney will require the whole of the written documentation. The prudent investor knows, in real estate, everything should be in writing! And every contract should have an escape (“weasel”) clause! --Eduardo P.S., as Jim Piper indicates, contacting the local Board of Realtors is a worthless exercise in futility.
Different Rules… - Posted by Carmen_FL
Posted by Carmen_FL on November 09, 2000 at 09:45:55:
In every state, it seems. In Florida, and don’t quote me on the exact time periods, but a broker has a certain amount of time to either a) disburse the funds as requested or b) contact the Division of Real Estate/Real Estate Commission to advise them that there is an escrow dispute. I think that time period is 10 or 15 days. They then can request a Disbursement Order from the RE Commission; they have (I believe) 30 days to do so. They also have the option of requesting arbitration.
In these cases, though, you would not have access to the process whereby you can claim funds if a broker/realtor does something wrong - they haven’t (unless they’ve exceeded the amount of time given to them by law or did not report the dispute to their board, if that is a requirement). Brokers must follow very specific and stringent rules for disbursing escrow amounts, or they could get into big legal trouble. Another reason I, as a broker, refuse to carry an escrow account! I use a title company instead, let them deal with it.
Every state has its own laws as to how to deal with escrow disputes; perhaps the best thing would be to call your Division of Business and Professional Regulation, and locate the Division of Real Estate and ask them what the law is and what your options are in your state.
This is why… - Posted by Radney
Posted by Radney on November 08, 2000 at 22:20:43:
I will outright refuse to put up any more than $100.00 when it’s listed and $10.00 through the owner!
$1,000.00 earnest money from me is “UNHEARD OF”
Hey , live & learn
Re: I want my money back… - Posted by JPiper
Posted by JPiper on November 08, 2000 at 20:45:34:
This is one of the problems involved with earnest money: that unless both parties to the contract consent to it?s distribution then it may well sit in an escrow account.
Here the Realtor contract for example sets forth the procedure for handling earnest money. Under this contract you would tender a written request to the Escrow Agent for your earnest money. The Escrow Agent would then send a certified letter to the other party. If there was no response to this letter then after 60 days this ?non-response? would constitute consent to distribution of the earnest money. The contract specifies this.
However, if the other party DID respond, and there was a dispute regarding the earnest money, then the Escrow Agent would commence an interpleader proceeding, paying the earnest money funds into the Court for distribution as the Court may determine.
In my area the Board of Realtors would have NO jurisdiction in a matter of this type. Further, the Broker?s insurance carrier would NOT be responsible for any claim of this type. In the event that the Broker is holding the money as Escrow Agent, and in the event that the earnest money has been handled improperly, then the State Real Estate Commission would be the entity to file a written complaint with, and of course they would investigate it.
But in this case it doesn?t particularly sound like the Broker has handled the money improperly (assuming they hold it). They are simply NOT authorized to return it without authorization of BOTH parties. This would not be considered an illegal action.
I would send a formal demand letter to the Escrow Agent or Broker (whoever is holding the money), and demand the return of the earnest money. READ your contract as to the procedure involved when there is either an absence of agreement or a disagreement concerning the earnest money. This may shed further light on how it would be handled after your written demand.
Re: I want my money back… - Posted by SCook85
Posted by SCook85 on November 08, 2000 at 20:06:01:
Provided that you really have a claim you can go to the board of realtors and file a complaint. Agents have insurance for situations such as this one and the board of realtors will investigate the situation to make sure you get your money.
I’m curious, what contingencies did you have in your contract?
Re: How to get it…(next time, if not this time) - Posted by Rob FL
Posted by Rob FL on November 09, 2000 at 15:01:46:
Also for next time around, I use a clause in my contract addendum that says:
“If for any reason whatsoever the deposit(s) specified in the Contract is to be returned in full to Buyer, said deposit shall be returned within seven (7) days.”
$100 is my max. also. (nt) - Posted by SusanL.–FL
Posted by SusanL.–FL on November 09, 2000 at 11:32:11:
Re: This is why… - Posted by Shenesa
Posted by Shenesa on November 09, 2000 at 08:02:44:
Yes we do Live and Learn.
I am coming to find out that EVERYTHING is NEGOTIABLE. I dealt with a foreclosure where the bank wanted $1,000. I told them NO WAY! We settled for $100. It is not law to put a certain amount down for a deposit especially if you are making multiple offers. I’m helping to solve your problem.
Re: This is why… - Posted by Rob FL
Posted by Rob FL on November 09, 2000 at 07:59:51:
With this low amount of earnest money, don’t the Realtors give you alot of grief for that? I have a hard time believing you get very many offers accepted on Realtor listed property with only a $100 deposit. If you are successful, tell us some of the strategies you use.
As for FSBO property, I agree the lower the better. $10 is pushing it unless the seller is just dumping the property though.
What ever happened to “SIMPLICITY” - Posted by Gene
Posted by Gene on November 09, 2000 at 22:47:32:
Here he goes again with his “LONG DRAWN OUT STORIES”
A few simple words would have been fine, but this guy has to feel good by confusing us newbies here with all of the “MUMBO JUMBO”
I like simple! He likes complicated!
Re: “SIMPLICITY” I thought I knew a lot, - Posted by Brent_IL
Posted by Brent_IL on November 13, 2000 at 19:05:24:
a whole lot, about CRE until I read every post on this board. I have never failed to learn something of immediate value from J.Piper, Merle, or any of the other posters. It still amazes me that highly successful people take the time to answer questions they have no doubt answered many, many times before, simply to be of service to those of us without their experience. Like Hope(FL) and Mark-NC, I am very greatful. I also agree with Carmen_FL. The war stories put in all in perspective.
Re: What ever happened to “SIMPLICITY” - Posted by Cj
Posted by Cj on November 13, 2000 at 02:46:56:
Gene, thats the beauty of this site,if ya don’t know ask,if ya don’t understand ask.If ya don’t like what you read, press on. This is the ONLY site I’m aware of with this much FREE information in complete thoughts.Yes, some people have courses on this site.Granted,but the FREE,(theres my favorite word again)information rules.I am a newbie too.By reading and asking I’m now an informed and educated newbie.That’s P-O-W-E-R and that equals my second favorite word…MONEY. Good luck CJ
There are no simple answers… - Posted by Hope(Fl)
Posted by Hope(Fl) on November 10, 2000 at 14:20:32:
J.Piper takes ALOT of his personal time to answer questions in order to help other investors. His experience in real estate enables him to see many sides to every question, and he therefore doesnt rush an easy answer, but tries to explain different angles of the problem. I for one, ALWAYS read his posts and am very GREATFUL that he is kind enough to share his wisdom and experience with us.
I LOVE “Long, drawn-out stories”… - Posted by Carmen_FL
Posted by Carmen_FL on November 10, 2000 at 09:35:02:
They’re like mini-seminars - for free! The more of these “seminars” I attend, the better I get at what I do.
I’m sorry if you’re having difficulty reading the big words, and they confuse you. I guess you still need the kindergarden version - I’m ready for my PhD!
Don’t read them if they’re too complicated for you - Posted by J.P. Vaughan
Posted by J.P. Vaughan on November 10, 2000 at 08:17:36:
No one is forcing you to read anything here. Cut the
BS comments. They make you look like a “simpleton.”
Re: What ever happened to “SIMPLICITY” - Posted by JPiper
Posted by JPiper on November 09, 2000 at 23:46:48:
Perhaps you’ve stumbled onto the reason why you’re still a newbie…Matt dareligiousguy, Gene, or whoever you are.
Re: “SIMPLICITY” I thought I knew a lot, - Posted by C.J.
Posted by C.J. on November 13, 2000 at 22:18:53: