Seller didn’t sign contigency extension and not signing cancellation contract
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Seller didn’t sign contigency extension and not signing cancellation contract
We got into a contract with seller to buy a condo with some HOA litigation. So we put loan contingency for 2 weeks and paid 3 deposit to title company. My lender was taking more than 2 weeks to understand the litigation and so we requested for extension of contingency, but seller didn’t sign it. After 2 weeks, lender didnot approve loan and so we cancelled the contract. However, the seller is not signing the cancellation and we are unable to get the deposit back as we followed everything in contract. So what are the available options for us? The lender is forcing to get loan from lenders who approved loans in the same community but charge very high interest rates almost 1.5 more than my lender from whom I have pre-approval.
Asked on March 9, 2019 under Real Estate Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
The seller is not required to grant the extension: they are allowed to insist on the time period or closing date in the contract. And if you cannot get your financing lined up within that time, they do not have sign a cancellation of contract and agree to let you have your deposit back--if you cancel the contract for any reason, including difficulties with your financing, they are allowed to keep the depsoit. In short, they don't have to accommodate you, but can insist on strict compliance with the contract, and if you do not comply do not have to give your deposit back to you. Based on what your write, it appears rthey can keep the deposit.
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