The builder was in default on a New Home Contract. The builder agreed to the return of earnest money to the Buyer. The buyer's mortgage broker then sent the bill for the appraisal ($325), and an additional appraisal fee ($100) to the title company for payment from earnest money. When the Buyer consulted with an attorney, the Buyer was informed that they were not responsible for the appraisal since no closing took place and the Buyer was not in default. In this case, who pays for the appraisal???
2006-11-04 07:47:32 · 6 answers · asked by TSunrise 1 in Business & Finance ➔ Renting & Real Estate
Buyer get the earnest money back and the mortgage broker is SOL. Should have collected for the appraisal up front.
2006-11-04 09:29:36 · answer #1 · answered by Karen R 3 · 0⤊ 0⤋
The earnest money is to protect the seller, not the mortgage company. The mortgage company cannot go after the earnest money in this case.
The mortgage company can go after the buyer in civil court as the buyer is the one who contracted the appraisal. However, it was the builder who defaulted so the buyer would then go after the builder for these additional fees.
2006-11-04 07:49:18 · answer #2 · answered by Plasmapuppy 7 · 0⤊ 0⤋
The Earnest Money Check should NOT be made out to the mortgage broker. Is the mortgage broker the real estate agent on the house as well? In some cases the Real Estate Agent can have the earnest money payable to their real estate company and the funds will be held in a Trust Account. If it was payable to the individual mortgage broker than there is a big problem. You should contact the mortgage brokers boss or the state banking department to see what you should do.
2016-05-21 23:33:06 · answer #3 · answered by Anonymous · 0⤊ 0⤋
The mortgage company is out of luck and will have to pay for the appraisal. They should have collected up front from the buyer. Unless the buyer signed something saying they would pay for the appraisal, the mortgage company is stuck. They should have known better.
2006-11-04 12:57:09 · answer #4 · answered by Realtor Jim 2 · 0⤊ 0⤋
Who ordered the appraisal? Not the buyer the lender did. The lender always orders the appraisal to protect the loan. Go after the lender.
2006-11-04 07:51:16 · answer #5 · answered by Anonymous · 0⤊ 0⤋
the bank should go after the seller. if they went bankrupt then the bank should just eat it.
2006-11-04 07:50:01 · answer #6 · answered by george 2 6 · 0⤊ 0⤋