| jacksu@gmail.com 2005-10-26, 12:21 am |
| Five month ago, my wife and I signed a contract to buy a house in a new
community which is still under construction now. We have put down 12k
for the deposit. Recently, we have decided not to buy the house. By
defaulting the contract, our understanding is that we are going to lose
the deposit. However, the seller told us if we defult the contract, we
could lose up to the full price of the house, which is 440k. We tend to
think that the sales woman was just bluffing, she maybe just try to
keep her commission. A friend of mine, who is a realtor, told us that
such big a builder like this one wouldn't want to sue a cumstomer,
since they already got all the deposit money.
We have read through the contract, but still having trouble to fully
understand what may be the worst possible consequence.
Here is what the contract says:
If you default, we can do one of the following:
* terminate this aggreement and retain your deposit(s) as liquidated
damanges; or
* exercise any other right or remedy under applicable law or equity.
It also says on another page:
If you default on your agreement of sale, we may retain any deposits
paid, including any option deposites, as liquidated damnages.
We understand that we should never do such things in the first place,
and we are willing to take responsibility for the defaulting. We think
12k should be enough to cover the monetory damage. But if the saler is
telling the truth, we are going to pay 440k! Is that true? What could
be maxium penalty? Thank you for your help!
Best Regards,
Jack
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