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Is Seller being unreasonable?

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Flagpole
Established Member

Is Seller being unreasonable?

We have an accepted offer in on a house and in attorney review the seller has now asked that the mortgage contingency be amended to indicate that should we not receive a commitment letter from a lender by a certain date, we would forfeit our deposit to the seller in full.  In this case the deposit is half of our 10% down payment.  Does this seem like an odd request from the seller?  Seems a few things could kill the loan that are out of our control, like the appraisal.

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3 REPLIES 3
mahiven
Regular Contributor

Re: Is Seller being unreasonable?

I might be wrong, but if they try to ammend the contract, you both have to agree to it. Second, there are a lot of variables. You mentioned your down payment is 10% of the sale price and that your deposit was 50% of the 10% down payment. How much was your deposit? Next, how long have you had the house tied up? If you've been trying to get this mortgage done for three months and it is starting to look like it is going to fall apart, I don't blame them for trying to get some money out of it. But if that isn't the case, they are being unreasonable.



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Message 2 of 4
Flagpole
Established Member

Re: Is Seller being unreasonable?

Contract signed on Sunday, under attorney review for the last three days.  Deposit in the range of $20K.  Seems like there is little upside, because if it does not appraise for example, the loan will not go through.  We do both have to agree, but a penalty of this size seems odd to me.  I do want the property, but the assumed risk seems outrageous.

Message 3 of 4
ShanetheMortgageMan
Super Contributor

Re: Is Seller being unreasonable?

It's a standard clause to have in most purchase contracts.  I am not sure where you are buying (not in California obviously), but here in California the financing needs to be in place by the 17th day as the financing contingency comes off by then (it needs to be removed in writing, by the buyer or the seller can cancel and the buyer gets their funds back)... if your contract doesn't have that extra security of the buyer having to remove the financing contingency, rather than it automatically being removed, you may want to suggest to the attorney to include it.

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