Legal Question in Real Estate Law in California
Locking up the properties with Mediation.
We have put 2,000 deposit when purchasing two houses in Central California. My husband has signed a paper that deposit was nonrefundable on the promise from our Mortgage Broker that the closing will happen on time.
The person handling our loan completely droped the ball, and we went few weeks past the closing date. He kept telling us and the seller that tomorrow we will close, which did not happen. At this point the seller wants to get out of the contract and take our deposit.
All we care at this point is to get our deposit back. At this point we can go into Mediation. My question is is there any way to lock up the properties with Mediation, so that the seller would consider giving us the money, since he knows it is not our fault that we did not close.
Also we are thinking to sue the Mortgage Broker in small claims.
1 Answer from Attorneys
Re: Locking up the properties with Mediation.
You actually lock up the property by not releasing the funds from escrow. However, there is a statutory penalty that you might be required to pay if the seller sues you to get the money released.
Usually a contract dispute cannot be mediated if the amount is less than $5000, which appears to be the case here. Furthermore, mediation is not inexpensive. You need to hire a mediator. Then, if you lose, you might be required to pay the other sides attorney fees.
My guess is that your best bet would be directed at the loan broker. You should also find out who his boss is, and contact that person directly.
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