Legal Question in Real Estate Law in California

As a buyer, my husband and I entered escrow to purchase a house using all the CAR forms. The home inspection found a need for further inspections: mold, chimney, foundation contractor, roof, geo-technician, plumber, electrician- there were a ton of inspections, it went on and on, after the 17 days, and the sellers were cooperative allowing us to continue the inspections as it was very large house with LOTs of problems, and escrow continued. So after all the inspections, we submitted a Request for Repair long list on a word document and went back and forth for over a month- on the sellers end, they made us wait for the first counter almost 4 weeks! In the end, we changed our mind and decided to cancel based on the Inspection Contingency(too many repairs- a money pit), which was never removed but was clearly after the 17th day as we were working together, negotiating, so escrow continued. I've been told that we have a right to our deposit back since we've been good faith buyers with the intent to buy, but changed our mind. The sellers have not signed the cancellation yet and I'm anxious they will fight us, take us to arbitration, but in good faith, we can show how hard we worked to negotiate the repair coverage and ultimately weren't happy with their penny pinching and lack of willingess to cover a massive amount of work on their home. Do they have a case to keep our deposit? They also hid things like a broken sewer line- not disclosing could be breach of contract. Will we get our deposit back? I understand they have 30 days to sign or file a good faith dispute or have a $1000 penalty.


Asked on 9/13/12, 9:54 pm

1 Answer from Attorneys

Not removing the contingencies within the 17-day period gives the seller the right to demand you remove the contingencies or the seller can cancel the contract. It does NOT bind you to the contract unless you cancel by that date. So do not worry about that time limit. If you have not removed the contingency you still have the right to cancel and they have no right to keep any part of the deposit.

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Answered on 9/14/12, 9:31 am


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