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I'll keep this short and sweet and also purposefully vague. I know the details of laws regarding this are going to vary from state to state, but really what I'd like feedback on whether I'm being "unreasonable".
The place where this is going on is a very small town - if we make a fuss, everyone is going to know we are the ones who did so and ... well, suffice it to say it's not a great way to start in a new place is it?
We closed on a house there about a week ago. But before this one (ie, ours) we'd made an offer on another. Sellers and ourselves couldn't agree on price, so we went our separate ways - all clean and kosher. In submitting the original purchase agreement, we also handed over an earnest money check.
In due course, a check from the seller's agency for the amount of the earnest money was sent to us. We sent it off to the bank and thought nothing more of it (it's not an account I use much) until some days ago when, lo and behold, it was returned to us. "Insufficient funds". Their refund of earnest money check bounced.
At first, I didn't really understand the implications. I was more just angry than anything. But it became clear to me that .... well, it's sort of bigger than that, isn't it? Escrow is escrow for a reason, no?
I immediately called our agent with whom we have an excellent relationship, who was horrified. It was taken to his broker/owner - they have scanned copies of what we received. It is being dealt with, however, I have to admit my patience is wearing thin because the last I heard... well, "everyone" hopes to have a refund to us before the end of week. End of the week?! The original check was written to them, oh - probably at least 6 weeks ago. My temper is getting the better of me and I'm trying really hard not to let it because nothing good is going to come of me going ballistic. I'm old enough and ugly enough to know this, but at the same time.... it's hard not to say, "Fine. We want our original payment, our bank fees, AND six weeks worth of interest thank you very much. You used money you had NO right to use, so to me, that's a loan. Cough up."
I shall now go lie in a darkened room to bring my blood pressure back down.
The check bounced? I can not see that being possible. Once you give a deposit it goes into escrow. Thwn if the deal falls through the real estate company or closing company writes you a check back. If the check bounced the company is not going to be in business much longer.
You need to rely on the professional regulations and ethics of the brokers involved. If this was not a simple screw-up then you do have some righteous anger to deal with.
Even it was not a screw-up, but deliberate attempt to use funds that should have been merely "in safe keeping" it won't do you any good to blow a gasket over it. The interst these days is laughably small. If the bank won't waive the "returned check" fees on a little used and hopefully not over drawn account for an event that ought to be an obvious real estate deal I would speak to the bank manger that this is a good indication that they do not value your business and your will be moving your business to an institution that seems to be more customer oriented...
I suspect there are laws governing this too. In Illinois when a situation like this occurs the agents involved can be held liable...
I recently caught wind of 30k EM deal that fell apart just hours after acceptance. It took days for the check to fully clear the account - initially the broker just about cut it back immediately, he did not due to the snowball effect if that check had been bad (it wasn't). Maybe something like this occurred (minus the caution the broker used in this case) and then your check bounced as well. The potential buyers were quite frustrated at the lag, but they didn't use certified EM so not really the brokers fault, he was just protecting the account from fraud until it cleared.
Seems fishy EM was deposited without accepted terms on the contract though - Not how it works in my neck o da woods..
In Indiana, there would be a padlock on the broker's office & they'd be under investigation quicker than you can say ... well, um, let's just say it would be super quick.
I'm confused. Was the money deposited in escrow or a brokerage client trust account? If the listing agent sent you the check then it was in a client trust account and NOT in escrow. These are different things. If they bounced a check from a client trust account, they will face a suspension or a revocation of their license if they were in Oregon.
You are not being unreasonable. This is a horrifying situation and worthy of a complaint to the state real estate board when all is said and done.
I'm confused. Was the money deposited in escrow or a brokerage client trust account? If the listing agent sent you the check then it was in a client trust account and NOT in escrow. These are different things. If they bounced a check from a client trust account, they will face a suspension or a revocation of their license if they were in Oregon.
You are not being unreasonable. This is a horrifying situation and worthy of a complaint to the state real estate board when all is said and done.
Apologies - my use of terminology was incorrect. While I cannot say with certainty where our earnest money was deposited, the check that bounced was from a client trust account. It was NOT from our account - our check cleared without incident. I've never bounced a check in my life.
From what I have researched I cannot see how it can be a "simple screw up" - but again, I come here to be corrected if needs be.
So far, we have been offered no explanation either.
The check bounced? I can not see that being possible.
Well, no, being naive, neither did we. But it did. I have the returned check to prove it along with a letter from our bank explaining why were were charged.
I'd say that if they don't make this right very quickly you should call the state RE board and report it.
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