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Attorney2
Attorney2, Attorney
Category: Legal
Satisfied Customers: 5677
Experience:  28 Years In General Practice,
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I applied 2k earnest money on an offer to buy a 3 bedroom 2

Customer Question

I applied 2k earnest money on an offer to buy a 3 bedroom 2 bathroom home. The appraisal came back as a 2 bedroom 2 bathroom home. Based on this my agent advised that the seller would sign a mutual release.
Today I get a letter stating that they are giving my earnest money to the seller based on 876 IAC 8-2-2.
My agent advised me to seek legal advice.
v/r
Josie Miller
Submitted: 12 months ago.
Category: Legal
Expert:  Attorney2 replied 12 months ago.

Welcome and thank you for your question. Can you tell me who sent the letter? You stated "they"

Customer: replied 12 months ago.
The selling agent..it is his home..well his soon to be ex wife's home. It is listed in her name.
Expert:  Attorney2 replied 12 months ago.

Thank you for the clarification.

Expert:  Attorney2 replied 12 months ago.

Give me a few moments to pull up 876 IAC 8-2-2.

Expert:  Attorney2 replied 12 months ago.

The seller would only entitled to earnest if the purchaser was in default under contract. You stated the appraisal came back showing that in fact this was a 2 bedroom and not a 3 bedroom home. When did you become aware of the appraisal? Did the lender deny financing based on the appraisal?

Where I am having an issue with is what notice did your agent provide to the seller requesting the mutual release of the contract?

Customer: replied 12 months ago.
I received the appraisal on the 20th..I immedialty advised her in writing that I was not wanting to pursue this with it documented as a 2/2. She had me sign the mutual release on 11/25/15. The final approval is still pending with the lender..
Customer: replied 12 months ago.
My letter is dated 12/10/15 that I received certified mail today.
Expert:  Attorney2 replied 12 months ago.

I don' t see where you have defaulted. You would not be required to continue with the transaction if the property is not what is stated in the contract. Can you attach your contract and the letter?

Customer: replied 12 months ago.
here is the mutual release
Expert:  Attorney2 replied 12 months ago.

The release is not setting out the legal position for terminating the contract. Personally I am very disturbed by the situation and cannot imagine the theory the seller is using to suggest they are entitled to keep your earnest money when they misrepresented the bedrooms. The language they are citing ( 876 IAC 8-2-2) allows the seller to retain the earnest money in the event of default on your part I see nothing to indicate that you defaulted.

Let me make sure that I am clear on the facts. Thank you for your patience in answering my questions as I want to make sure that you will get your earnest money refunded. You stated that The selling agent..it is his home..well his soon to be ex wife's home. It is listed in her name. The listing agent is the person that represents the seller. The Selling agent represents the buyer. I believe that you are telling me that the listing agent's wife is on the title to the property. Is that correct?

This adds another level as the listing. agent needed to disclose the true nature of the number bedrooms and I see an ethical issue for the realtor not only trying to keep your earnest money but also providing misleading information with regard to the number and nature of the bedrooms.

One way or another this is a problem for the listing the agent.

Customer: replied 12 months ago.
your facts are correct. Here is the letter I received today.
Expert:  Attorney2 replied 12 months ago.

The letter is very clear that the seller is trying to retain your earnest money. There are several paths that you can take. You can file a complaint with the licensing board at http://www.in.gov/pla/3171.htm

If you can tell me the county where the property is located I can provide a link for attorneys that provide free consultations as letter challenging the realtors position may be all that is necessary to release the money.

Customer: replied 12 months ago.
It is in Lake County Indiana. And yes I'd appreciate a referral to someone whom could assist myself further. I do have the appraisal and all needed documents to support this situation.
V/R
Josie Miller
Expert:  Attorney2 replied 12 months ago.

http://lawyers.findlaw.com/lawyer/firm/real-estate-law/lake-county/indiana

If you have any additional questions please do not hesitate to let me know. If you would be kind enough to rate my service positively so I may receive credit for my work I would appreciate it.

Thank you for using JA! We appreciate your business.

Expert:  Attorney2 replied 12 months ago.

Please ignore the additional services request. Thank you.

Expert:  Attorney2 replied 12 months ago.

Please ignore the additional service requests. Did you want me to have your attached letter deleted for privacy as this site is open to the public? The attorneys on this site only receive credit for their work if the customer rated their service positively. I hope that you were happy with my service and will take the time to provide me with a positive rating. I receive no credit if you do not rate my service positively. Thank you for using JA! We appreciate your business.

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