Whether youre cancelling your escrow because you couldnt
get your loan approved using the mattress money youve been keeping at home
for your down payment, or you couldnt get your loan approved due to the
pending litigation against the HOA, or you couldnt agree with the sellers
about the severity of the mold issue, the cancellation process is virtually the
same. You cannot announce your decision
to cancel the transaction and expect to pick up your deposit refund the same
afternoon. Here are the most important things you need to know when you need to
cancel your escrow.
- 1. The buyers and the sellers have to agree to
cancel the escrow. In writing. Theres a convenient form provided by the
California Association of Realtors to use to facilitate the cancellation which
asks for things like whos initiating the cancellation, the specific reason for
the cancellation, and what is to be done with the buyers deposit funds. Whichever side is initiating the cancellation
fills in the form and sends it over to the other side for agreement. Usually
the two agents have chatted and the request for cancellation will not come as a
surprise to the other side. Thats the
best way to ensure a smooth cancellation.
It might take a few days to get the cancellation
agreement signed. The seller might be on
vacation and unable to sign the cancellation document. The seller might try some last ditch effort
to take care of the mold that might keep you in the deal. And they might take a few days to put their mold
treatment package together. This delay
might impact your pursuit of a replacement property, especially if you need the
money from your initial deposit to make a deposit on another escrow to purchase
a different home.
You may not get the entire amount of your
deposit returned to you. Once you have
the cancellation agreement signed by both parties, escrow will balance out the
account and calculate the amount of your refund. Things like an escrow cancellation fee, fees
for a Home Owners Association certification, a messenger fee to pick up said
certification, or the fees for the HOA documents, if you agreed to release some
of your funds to pay for the HOA docs, may be subtracted from your deposit. Usually, if you return the HOA documents in
their entirety, to the escrow office, they will refund you the cost of those
The bottom line is that It takes time to cancel
an escrow. And the buyer might not get
exactly the same amount of money refunded that was give as the initial
I'm Leslie Eskildsen, Realtor.
Call me. Text me. 949-678-3373
Email me. Leslie@LeslieEskildsen.com
Helping you make the right move in Mission Viejo, Coto de Caza, Rancho Santa Margarita, Irvine, Laguna Niguel, Laguna Hills, San Juan Capistrano, San Clemente, Laguna Beach, Newport Beach, Dana Point, Corona Del Mar, and other Orange County communities.