Let me just jump right in on this. Recently my partner and I got involved in our first owners financing deal. The numbers sounded to good to be true, so of course, they were. The seller had no idea what he was doing or how to structure owners financing, he was simply done dealing with the banks and so had taken out a $60k line of credit out to offer owners financing for his paid off SFH, with an asking price of $85k and $25k down payment up front. Initially, he didn't even want to use attorneys, but we insisted. Before entering under contract, we made the mistake of conceding to place a $5k "holding" deposit, with a notarized, basic contract which guaranteed us the exclusive rights to purchase until contracts were settled. Terms and contracts exchanged hands multiple times when seller determined he'd had enough of the back and forth and negotiating terms and decided to walk. We have since had our attorney contact him in regards to return of the $5k deposit, which he initially refused to return based on the statement "non-refundable deposit". However this "non-refundable deposit" was based on the continuation of the transaction and production of an acceptable contract. When our lawyer pointed this out to the seller, he agreed to settle for $3,500. We demanded full receipt but would accept $4k by the end of the week and he countered with $4k by the 30th. Our question is this, has anyone been in a similar situation and how did you handle it? And if he fails to produce the $4k by the 30th, is it worth it to take him to court? We would be unable to take it up in small claims court as its over $3k, so this would cost us roughly $2k to proceed in this manner. Any advice or thoughts would be greatly appreciated, thanks so much!

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Owners Financing gone wrong

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