Expert: Lisa Webber - 4/9/2008

Question
Hello!

I had a question regarding an earnest deposit. A year ago, I put a contract on a soon to be constructed condo. The initial delivery date given was September 2007 and actual delivery is April 2008.

I changed my mind about purchasing the condo due to what appears to be slow sales. I was to be in phase 3 and currently there are only 20 units occupied out of the 200 plus available.

I recently received a letter stating that I was to send in an additional portion of the earnest deposit because I broke the contract. The builder initially waived that portion of the deposit but has decided that it is now due. I was wondering if I had any other recourse or should I just expect to make the payment?  

Thanks in advance!

Answer
When you say that the builder initially waived an additional deposit, did he do this in writing?  What you'll want to do is carefully review the contract and paperwork that you signed.  Anything the builder said verbally is not binding, only what you have in writing is.  The builder can simply say that he never waived the additional required deposit. There should be terms in the contract regarding canceling the contract and what penalties if any are involved.  You may want to consult a real estate attorney and have the attorney read over your contract to see if you have any recourse or if you are required to pay any additional money.  Without reading the contract, I don't know whether you are required to send in the money or not.  I wish I could help further - good luck to you!