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Help!! Earnest Money Dispute (I’m the buyer)

First time homebuyer. Seriously looking since May.

Found a lovely “flipper” house in our desired area (we had branched our search out d/t market, so this was incredibly exciting). As with most flipper homes, very limited seller’s disclosure. We were first to view home and put offer in same day. Offer accepted and inspection scheduled. Inspector recommended foundation inspection d/t cracks, etc. Hired foundation company to come check it out. Home found to be approx 4 inches off level from front corner to opposite back corner. Agent advised to back out. I loved the home, and was already out the inspection and option fee so i figured it wouldn’t hurt to ask for repairs in contract addendum (among other minor repairs). I was shocked and relieved when the seller agreed to repair nearly every item on my list including “foundation repair to level entire home”. I continued on with life and assumed all was going according to plan, checking in occasionally but trying to be patient as well. I imagined close would get pushed back some as my understanding is the repair would be rather extensive. I was a bit confused when I was advised close date would remain in 3ish weeks from date of repair addendum acceptance. I was even more confused when I was told the repairs would be completed less than 2 weeks post addendum.

Checked with agent on progress as I was getting notifications from lender to make payment for appraisal. I didn’t want appraisal done prior to repairs and be stuck with a follow up cost. Agent advised title stating repairs done on 9/12 but sellers agent advising repairs to be completed 9/18. Tropical storm that same week/weekend. My agent and I scheduled final walkthrough on 9/21 two or three days prior to close. My agent has two + decades of experience in building homes and owns a zip level for foundation measurements. He brought the tool along with him to the walkthrough and took measurements. He recorded about 75% of the rear of the home was level, but the measurements were off from there. Still about 4 inches from rear corner to opposite front corner. Many of the items requested were addressed, however, there were other items not complete in addition to the home not having been leveled.

Requested extension on close date so we could get another foundation inspection, but the seller declined. Opted to terminate the contract under the grounds of repairs not completed prior to close. Seller is now demanding my earnest money. Mind you, the home went under contract the very next day and has now been sold to another party. I received a letter from his attorney demanding the release of the money or a lawsuit for breach of contract. I’m mind boggled that this guy is adding insult to injury and trying to take what I believe to be rightfully mine. I held up my end of the bargain. Spoke with seller over the phone today and he’s adamant that he has sufficient evidence to prove the repairs were done.

I have the report of my agent (drafted measurements), photos of other repairs not completed, and my word. Seller willing to settle for 1/2 of earnest money. On principle I’m struggling to part with any of it. He’s willing to pay an attorney a $1,500 retainer to go to court while the amount in question is $2,190. I don’t know what to do! I feel I have plenty of evidence to support my right to the money, but he apparently feels the same. And he likely has plenty of people in his corner to back him, even if it’s false.

submitted by /u/kaceej
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source https://www.reddit.com/r/RealEstate/comments/jld51j/help_earnest_money_dispute_im_the_buyer/

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