Legal Question in Real Estate Law in California

I was in the process of buying a condominium & I had put all the money that needed to be placed in escrow before the closing date. Now the closing date arrived & I was not approved for the loan & I received a demand letter to close escrow witch I did not sign.. I would like to know what happens will I lose any of my money deposite or down payment I have in escrow?

Asked on 12/22/14, 5:28 am

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This question can't be answered with the information you provided. The first missing piece of information is whether you had a loan contingency in your contract, and if so, was it released, and if it was released why did you release it without knowing for sure you would get the loan. If you had no contingency or released it prematurely, you could lose your deposit, up to 3% of the purchase price, or if you didn't initial the liquidated damages provision, you may be liable to the seller for his or her full losses. If you think you might still qualify for a loan, you might also see if the seller is willing to simply extend the closing, or will do so for some compensation. In short, there are way too many variables involved to tell you what will or could happen.

Answered on 12/22/14, 8:35 am

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