Expert: Dick Dennis - 12/6/2007

Question
Okay, so I'll try to make a long story short. My husband and I signed a purchase agreement on a home (contingent on mortgage approval). The mortgage was not approved and we signed a release for asking for our EMD. The sellers refused to sign and stated that they were going to pursue legal action. We (my husband and I) sign another release form giving the EMD to them. The return response was that they would sign the form and release us from the contract if we agreed to pay them an additional $1000 (In total: $2000; $100EMD plus the extra) to cover any costs that they incurred from the sale of the home falling through.
Isn't that extortion? The sellers only requested a $1000 minimum EMD in the contract. If I give them the extra $1000, who is to say that they won't ask for more and continue the ball rolling? I have sought advice of a real estate attorney earlier in the contract and it has helped some, but I am a little shocked at their request. There is a strong chance that they will take this further (court) and I am clueless as to the turn out. Any advice would be greatly appreciated.

Thank You

Answer
On your purchase agreement there is a clause that stipulates that if you do not qualify for your loan to buy their house, Laci, they agree to release your EMD. So what is the problem? Further, the attorney did not seem to offer you any help. There must be something you did not tell me, especially when you not only agreed to release the EMD but you also entertained giving them some more! Something is not quite right, Laci.

If it was me, I would have told them I would see them in court with me filing the case. They have no right to keep a dime of your money, based on the information you gave me. Further, I would make sure that there is a lien on their house thus they would not be able to sell the property to anyone else until you got paid plus your costs.

For heaven's sakes, Laci, who in blazes suggested you give up so easily? I do wish you well.

Dick Dennis         dixiedee13@aol.com