Expert: Dick Dennis - 11/8/2007

Question
We approached Beazer homes to buy a new home in early Jan 2007. We signed up with them in February and paid an earnest deposit of $4000.00.  As we already owned a home, we were not qualified on zero down.  With the consent from the builder we got loan approved through an outside lender for zero down.  Beazer approved the loan papers.  Their initial day of closing was July 2007.  But moved to August 2007 later on.  Unfortunately at the same period, mortgage industry changed dramatically and the loan product we were approved was taken off the shelf.  Our loan office informed Beazer through an email following which we met the new home counselor to discuss further action.  She sought the help of a loan officer and assured us of researching further on 5% down option.  When asked about if we need to contact the title company she assured us positively that she would let them know about it and we need not worry.  We checked on the same day about refund application.  As we showed interest about the 5% down loan, she advised us to wait for her call on the same.  She contacted us 2 days before the closing for refund application. She also mentioned that Beazer moving the date by a month has affected us and would help us in getting the money back by explaining the details to the regional office.  Now we are denied all the money.  Reason given:  We did not inform them in time before closing about not getting a loan.  Our contention is we did inform, but the counselor has taken advantage of our situation and let us down by not contacting the title company in time and not warning us on the consequences of delay in contacting them.   Loan was not available to us because of the way baning industry decided to do loans.  Not our mistake.  We qualified for the loan all the time. Is there any chance for us to get the earnest money back?

Answer
Since the amount is $4,000, being less than the small claims court limit, you should file a small claims action against the company. You must first send them a letter via certified mail requesting payment. If you already have a copy of such a letter, then you can skip it. Each company has a another company that accepts suits on behalf of the company being sued. You must find out to whom you must send the small claims action on behalf of Beazer. Be sure you have any and all receipts you have and any and all documents of any kind in this matter. I do wish you well.

Dick Dennis