Q: Last year, I put down cash for a deposit on a preconstruction condo. My financial status has now changed because my old car broke down and I need to replace it. Making a car payment and a mortgage payment will not be feasible for me at this time.
I notified the builder of my intent to back out from the agreement and requested a full refund of my money. They will not refund my deposit money. The building is due to be completed in late October of this year. Please help.
A: Buying a condo isn’t like buying a flat-panel television set from Costco. There’s no 90-day no-questions-asked refund policy. Unless it is specified in the contract, there is no obligation on the part of the builder to return your deposit if you cancel the contract.
Builders are facing cancellation of new construction contracts all over the country. Sales of new homes have dropped significantly, and many of the smaller builders are either going into bankruptcy, or laying off workers in order to survive. It’s all part of the big slowdown in the real estate market.
The builder can’t stop building your condo just because you’ve decided you can no longer afford it. He or she is building a big building and has committed the resources and funds based on the legal contract that you, and many other buyers, signed. Without those contracts, the builder wouldn’t have been able to get the funding to complete the project.
If you read your contract, you will probably see that the builder gets to keep the deposit if you cancel for any reason other than those specifically named in the contract.
It’s a little late now to back out and expect the builder to refund your money simply because the property has become unaffordable for you.
The way I see it, you have three choices: Buy a less expensive car, get a second job so that you can afford to live in the condo, or walk away from your money.
Published: Jul 18, 2007