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I made an offer several weeks ago, went to highest and best, and ultimately didn't get the place. I was notified of that nearly 2 weeks ago (on 2/17)--I emailed the agent this past week to inquire as to the return of my initial deposit, but haven't heard back. Is there a law governing this? I'm in NJ, if that matters. Thanks for any insight!
Normally the EMD check is not even cashed or delivered to the escrow company until you have an accepted offer. Your check is likely floating around someplace. Did you make the check out the the title company with instructions (written) to your agent to hold the check until escrow opened?
Yes there are laws - your agent's broker would know what applies to you in NJ. Please contact the broker if you do not hear from your agent.
I can't help with NJ law but it seems reasonable to assume that your check was probably not immediately deposited and they won't issue a refund until it is certain that the funds have cleared. There have been reports of scams around the country where checks were deposited, amounts refunded after the check clears, and then it turns out that there is a chargeback that leaves the middle guy holding the [empty] bag.
Normally the EMD check is not even cashed or delivered to the escrow company until you have an accepted offer. Your check is likely floating around someplace. Did you make the check out the the title company with instructions (written) to your agent to hold the check until escrow opened?
Yes there are laws - your agent's broker would know what applies to you in NJ. Please contact the broker if you do not hear from your agent.
Quote:
Originally Posted by bbronston
I can't help with NJ law but it seems reasonable to assume that your check was probably not immediately deposited and they won't issue a refund until it is certain that the funds have cleared. There have been reports of scams around the country where checks were deposited, amounts refunded after the check clears, and then it turns out that there is a chargeback that leaves the middle guy holding the [empty] bag.
In the State of Georgia, the check would not have been cashed/deposited either until the offer was accepted.
If you don't hear back from the Agent, you need to speak to their Broker.
Stay on the agent, stay on the brokerage. Wait a couple more days then give a date certain when the deposit must be back in your hand or you will explore further steps. Maybe mention your state's Real Estate Commission.
This happened to my daughter a few years ago. She placed a deposit on a house (which was perfect for her) which failed the septic inspection. There was no negotiating for a lower price, the asking price was firm.
It took her three months to receive a return on her deposit and it only came after the demand letter (up until then it was always "I'll drop it in the mail tomorrow") and the Real Estate Commission reference. Funny thing, the return check was written on the brokerage's account.
She found a different house to buy a couple months later so it all worked out. Funnily enough the original house went to auction with the winning bid 1/4 of her offer.
It took her three months to receive a return on her deposit and it only came after the demand letter (up until then it was always "I'll drop it in the mail tomorrow") and the Real Estate Commission reference. Funny thing, the return check was written on the brokerage's account
That's awful at how long it took your daughter to receive her earnest money back!
If I am reading your post correctly, she was under contract and was in the due diligence period so her earnest money check would have been deposited and the real estate brokerage would have written her a check from their escrow account. She would not have been given back the check she wrote to them because it was already deposited.
That's awful at how long it took your daughter to receive her earnest money back!
If I am reading your post correctly, she was under contract and was in the due diligence period so her earnest money check would have been deposited and the real estate brokerage would have written her a check from their escrow account. She would not have been given back the check she wrote to them because it was already deposited.
You are correct. I guess what raised my hackles, and suspicions, was the length of time it took. It wasn't from their escrow account but the regular account. I may be wrong, or remembering incorrectly, but I think I remember something about a "service charge" maybe having to be deducted. That didn't happen, either.
You are correct. I guess what raised my hackles, and suspicions, was the length of time it took. It wasn't from their escrow account but the regular account. I may be wrong, or remembering incorrectly, but I think I remember something about a "service charge" maybe having to be deducted. That didn't happen, either.
The length of time was inexcusable. Each state has laws stating how quickly earnest money should be returned to the client. "Playing" with the public's monies is highly frown upon and to charge a service charge would get them in hot water for sure!
You are correct. I guess what raised my hackles, and suspicions, was the length of time it took. It wasn't from their escrow account but the regular account. I may be wrong, or remembering incorrectly, but I think I remember something about a "service charge" maybe having to be deducted. That didn't happen, either.
In my area, if a check is deposited at the title company, and then the buyer backs out during their inspection period, the title companies must wait 15 BUSINESS days before cutting a new check back to make sure it clears their accounts. That's 3 weeks because it's business days and not calendar days.
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