Legal Question in Real Estate Law in Florida

What does ''diligent'' mean in a RE contract??

I, the buyer, need to cancel a contract because I cannot obtain mortgage for the amount specified on the contract. I've been to two banks, I could go to many more and they still wont underwrite the loan. How ''diligent'' is diligent. A lawyer and a RE agent have both said that one (1) bank rejection is enough. Is that true? Seller is threatening to hold my deposit if I don't get 3 rejections!!

I'm also suspicious that the seller did not put the deposit into an escrow account. Is there a way I can find out?


Asked on 5/18/03, 9:06 pm

1 Answer from Attorneys
Peter Gonzalez Sanchez-Medina, Gonzalez, Quesada, Lage, Crespo, Gomez & MachadoLLP

Re: What does ''diligent'' mean in a RE contract??

There is no legal requirement that you get rejected by 3 lenders in order to cancel the contract and have your deposit reimbursed under the financing contingency in most contracts. One rejection is sufficient. You should immediately send a letter to the escrow agent requesting written confirmation of the amount being held in escrow. If the escrow agent has failed to comply with his/her/its duties as escrow agent, he/she/it may be liable to you for your deposit funds. If you wish to discuss this further, please call my office at 305-445-0937.

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Answered on 5/19/03, 2:36 pm


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