Bank didn't approve the loan, does the buyer gets his deposit ?

[Tomer Amir]

Hi everyone,

The situation is this:

The buyer wants to buy a house for 200K, he singed on a purchase contract and on a deposit of 4K

Appraiser said that the house value is 170K and the lender is refusing to finance at a purchase price of 200K (he wants to go on 170K)

Obviously the seller doesn't want to sell at this price and the buyer can't finance the deal (Buyer's first house purchase ever) 

Dose the buyer have to pay the deposit?

In which cases he can get it back?

If the buyer's loan is FHA he is entitled to receive the deposit back by the low? (state of Forida)

Thanks!