Legal Question in Real Estate Law in California

The first question is what stage was your transaction at when you "backed out?" If the $7,500 was a security deposit and you backed out before close of escrow and recording of the deed, you have one set of possible remedies. On the other hand, if the $7,500 was a down-payment, the deed is signed, delivered and recorded, you have another set of possible remedies.

First, note that a seller usually cannot retain a security deposit in excess of 3% of the selling price when the buyer backs out, pre-closing. See Civil Code section 1675.

Next, note that a seller must deliver, in writing, certain disclosures to a buyer of residential real property. See Civil Code sections 1102 et seq., especially 1102.6. In addition to the statutory disclosure requirements, the common law of California requires a seller to disclose known factors which might affect a typical buyer's willingness to buy at the asking price.

Finally, since your loss is in the $7,500 area, you should consider bringing a suit in Small Claims Court. A starting point would be to obtain and review a couple of the self-help law books covering California small-claims procedures ..... I think a good one is the Nolo Press book by Anthony Mancuso, but I recommend getting at least two and comparing the procedures and recommendations. Look on Amazon, and be sure the books you buy are for California law. Small claims is cheaper and much faster, although the results are sometimes erratic.

As far as disability and AIDS, in some situations this might give you an additional argument (for example, as a tenant), but I don't think it makes a difference in an ordinary breach of contract matter.