Can I get my inspection, appraisal and application fee back if the seller has now backed out of the deal?

UPDATED: Sep 30, 2022

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Can I get my inspection, appraisal and application fee back if the seller has now backed out of the deal?

I signed a contract to purchase a home. I paid for the application fee, inspection and appraisal. The contract was already in the hands of the underwriter with closing date of 07/29. They asked if I could postpone for another month because the renter couldn’t find a place to live. I agreed. We moved the closing date to 08/29. A week into that month the seller decided to back off; they no longer wants to sell the house. Now I’m left with no application fee, inspection and appraisal money and want my money refunded to me. How can I write a legal letter demanding the refund before taking further action?

Asked on August 24, 2016 under Real Estate Law, Massachusetts


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

The fact that thwe seller backed out of the transaction does not require the lender, inspector, or appraiser, who have nothing to do with his decision, to refund your money or mean that they should not be paid for the services they provided or began providing. They do not need to give you a refund unless your agreement or contract with them requires a refund in these circumstances. You can, however, very likely sue the seller for all costs or losses you suffered, including these, due to his refusing to sell after you had contracted for the sale; you would sue for breach of contract.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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