Originally Posted by oilyfan
Disclaimer: you are asking for legal advice in a public forum. I am not a lawyer but like to play one on tv :-)
Now that is out of the way.
The only reason the brokerage is holding the deposit and insisting on the release is because something is in question, I believe. Was the agreement for the deposit clear about under which conditions it would be returned under? i.e. clear and unambiguous: if the home inspection has anything in it not to our satisfaction the deposit has to be returned.
It was crystal clear that I could pull the offer if the home inspection was unsatisfactory for me for whatever reason. Both my realtor, the selling realtor (now former) and the owner of the brokerage told me the sellers are refusing to sign the mutual release just to be pricks basically. The only conceivable reason would be that they are hoping we need the money bad enough that we won't be able to buy a home without it, and if they delay long enough, we might make them another offer. They get no benefit from not signing the release. In fact, they aren't even allowed to accept another offer on their home while that money is sitting there according to the realtors.
The "mutual release" is there is the event that I pulled the offer without a valid reason. I think it's ridiculous that they should even have to sign it, but apparently that is the way it works here.
Anyway, I personally contacted their lawyer today and he said he will contact them and tell them that they have to sign or there can be penalties. He wasn't clear to me what they were, but he said he would sort it out with them.
I will let you know how it turns out.
Just if anyone is curious, here is a short list of some of the issues the home inspection revealed:
- Water damage in the basement. When confronted, they said the house never flooded in the 5 years that they were there, however there was also water damage on the bottom of some of their furniture. When we pointed this out, they admitted that there was a plumbing issue but it was fixed.
- A pile of stuffed animals was in the corner of the basement. When removed, the laminate flooring was damaged and smelled like cat pee.
- No water to the bath tub.
- Seized garage door motor.
- Deck was falling apart.
- The addition they built did not have proper drainage.
- Some outlets and switches in the house had no power going to them or had the polarity reversed.
- Really bad paint job (it was hard to tell during the viewing because they had really dim lights in the house, but once the inspector shined the flashlight on the walls, you could tell. In fact, they painted in such a hurry, they even painted over their motion detectors).
- Baseboards not nailed in place.
- Plumbing pipes that went nowhere. They were not believed to be rough-ins, but just the remnants of a DYI project.
- Holes in the wall behind furniture.
- Basement sink had sewer gas coming up (was not installed correctly)
I could go on and on. We actually called it early and just said no. There was no point in even getting the report.