Can we get a deposit back for misrepresentation on a property?

UPDATED: Sep 30, 2022

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Can we get a deposit back for misrepresentation on a property?

The property has no deeds pulled for anything they added in the house. Illegal
work done. The appraisal is a lot less than what the seller is asking for the
house. Now the seller does not want to sell and does not want to give our
deposit back. Are we entitled to get our deposit back?

Asked on October 5, 2016 under Real Estate Law, Massachusetts


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

1) If you are ready and willing to go through with the sale under the terms previously agreed to but the seller will not sell, he is in breach of contract and must return your deposit.
2) Additionally, if the seller misrepresented material (or important) facts, such as that the work on the property was legal, that fraud allows you to void the contract of sale and get your money back. The misrpresentation can be by ommission as well as or in addition to being affirmative misrepresentations: to know that work was illegal but not disclose that critical fact is a misrepresentation.
Breach of contract and fraud can also provide grounds to get moneteary compensation (e.g. of costs you incurred during this process) as well as getting your deposit back.
If the seller will not voluntarily return the deposit, you will have to sue for it; if you have to sue, then you should (as long as you're going to that cost and trouble anyway) seek other compensation, too.

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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