We had a really good showing this Sunday. Some people were up here from 'down' state, drove past our house Saturday and stayed an extra night to see it on Sunday. They came, stayed 15 or so minutes, then came back about an hour and a half later to look again. That's always a good thing.
I figured maybe we'd get an off yesterday. But, nope. So, I spoke with my agent today to see what was what. As it turns out, they had the offer all ready to go, but wanted to speak with the bank yesterday first. After that, again, they were apparantly ready to go, until the topic of a deposit came up. For whatever reason, they appeared to not know they have to put a deposit down on a house when you make an offer.
I'm not exactly sure who thinks you don't have to put down a deposit when you want to buy a home. After all, there is really nothing to keep people from walking away from the deal. That's what the deposit if for.. to protect the seller. If the buyer walks away, the seller keeps the cash for the hassle.
So, I'm not sure what will happen with these people. Probably nothing. If you don't have the cash to make the deposit, then you won't get the house. I don't expect less than $10k for a deposit. $10k is hard for most to walk away from. Hell, I have $30k as a deposit in my new house. Think I'm going to walk away from that?
Posted by Kevin at March 07, 2006 09:15 PMThe deposit may not be that simple.
When we sold our last house, we had a guy come and check it out. Seemed fine. He said that the $1,000 of good faith money was hard for him to scrape up, so we let him put down $500. We started getting ready for closing.
A week later, his agent calls our agent to say that they're not going ahead with the deal. He had kept looking, found another house he liked better, and was going to buy that one. We scrambled to find a new buyer by our closing date, because we already were set to buy our new house. It was a week of real estate nightmare until we found someone else.
A few months later, after we were in our new house, the sheriff came to my door at 7am to serve me papers saying that the guy was suing us to get his $500 back. I went to court and the judge said that since I sold the house anyway, for the same price, no harm had been done so the guy was entitled to get his money back. Now I have a judgement against me on my credit report.
Don't know how common that is, but there you go.
I'm not sure if that's common or not. The judge may have figured that since you sold it in a week, there was little damage done (aside the PITA, which usually isn't compensable in contract law).
I think that if you lost your other home, or then couldn't sell your home for 30 or more days, the judgement would have been different.
It also may have been your contract. A deposit isn't "good faith" money.. it's a deposit. A non-refundable one, as stated in most real estate contracts.
That's also why I would never accept something like $1k. It's too easy to walk away from. The $10k is harder to do, and also takes funds away from what you'd need to put down for another house.
Did you go to court with a lawyer? A good contract attorney probably could have kept you the money, or at least part of it. But, I'd wager if you couldn't sell the house for a longer duration that you could have kept it.
I know every contract to buy that I've signed says the deposit is non-refundable, and has a lot of small print explaining that fact.
Posted by: Kevin on March 8, 2006 10:12 AM