Problem with home builder

[TheMortgageMan]

This a growing problem in the industry. I have been in the mortgage business for 14 years. SC is considered a preference state. That means you have the right to choose your own atty, insurance carrier when it comes down to rela estate transcations. When building or purchasing a car for that matter, it is always better for you to get your on financing and then you set the terms. You know exactly what you have and what you working with and you can talk to a person knowing were you stand. Before consulting an attorney, contact the SC Atty General's office, Better Biz Bureau and SC Dept of Consumer Affairs. All have very informative websites and youcan file complaints onlines. SC is really crqcking down on fraud and usually responds in a timely fashion. As far as earnest money, you should only give this to the Realtor or Atty involved with the transaction. This money is supposed to be placed in an escrow account, credited back to you at closing and if the transaction does not go through, it should returned to you. Please keep me informed as to the status. I hate for people to get taken advantage of when making such a crucial step in life. It makes all of us in this business look bad.

[missudpat]

The mortgage man is right. There's lots of fraud out there. You have to protect yourself before you get into contract. Get pre approved, if at all possible these days, before you consider buying. Check on the builders on line. Do your homework......dont believe their hype. Google [builder] and "fraud" to get spefics. Citi data and other sites will pop up. If interested in D R Horton, there is a mega site available called drhortonsucks.info.

[Brandon Hoffman]

Contact a real estate attorney if you have legal questions. I don't know NC laws but in SC the law states we MUST deposit the earnest money within 48 hours of an accepted contract. A contract is accepted when all involved parties have signed/initialed agreeing on terms.

[missudpat]

As for the earnest money.....many of the developers have clauses in their contracts whereby the earnest monies can be forfeited for virtually any reason and sometimes for reasons out of consumer control. The builder can merely not communicate with the consumer and not close close timely and therefore keep the money. Unless your state has an overriding bit of legislation, you can lose thousands in scams. Trust me, I was nearly a victim.

[Brandon Hoffman]

Originally Posted by missudpat

As for the earnest money.....many of the developers have clauses in their contracts whereby the earnest monies can be forfeited for virtually any reason and sometimes for reasons out of consumer control. The builder can merely not communicate with the consumer and not close close timely and therefore keep the money. Unless your state has an overriding bit of legislation, you can lose thousands in scams. Trust me, I was nearly a victim.

Builders are not con artists or scammers nor are they out there to try to get rich on earnest money. That is a very far fetched claim. They are out their putting a name on a product and value their reputation. At the same time, they are entering into a business agreement to build a very specific, expensive product for you so they expect you to follow through with the purchase. Earnest money is a part of every real estate contract that is one of the few protections for a seller. Every buyer and seller should select their agent carefully.

[missudpat]

Brandon, when I stated that builders can essentially steal your earnest money, I had the largest one in mind which, after my discovery of 100's of victims, did just that. But for the posting requirements here and not being allowed to gripe and name names, their trademark has been omitted. However, searches for 'builder fraud' tend to produce excellent results. Note that among the hundreds of victims already discovered, many bought from the top dozen builders. Also, HUD and the FTC have been investigating and finally imposing fines........albeit puny ones.