Ethical question: larger deposit returned

[Matt Liu]

I had a deal fall through due to the seller's poor title. After I spend 300 on inspections. The agent sent me back the deposit, double what I paid by mistake. I feel the right thing to do is tell him and send him back half. However I also feel a little like I got burned by the deal wasting money on inspection because they didn't do their research prior. What do I do?

[Account Closed]

Originally posted by Matt Liu:

I had a deal fall through due to the seller's poor title. After I spend 300 on inspections. The agent sent me back the deposit, double what I paid by mistake. I feel the right thing to do is tell him and send him back half. However I also feel a little like I got burned by the deal wasting money on inspection because they didn't do their research prior. What do I do?

Who didn't do the title research? That's not what agents or sellers do. That's what you do. The money you pay for inspections and appraisals is at risk in every deal. You could negotiate enough time in the contract to wait for a title report before spending the money. And even then, if the deal doesn't close at the last minute, you'd stlll be out any money you paid for inspections. Unless you negotiate a contract where the seller reimbuses you for inspections if the deal doesn't close (good luck with that!), that's the cost of doing business.

I've gotten several checks with mistakes in my favor, mostly from title companies over the years. I always call and make them re-do the numbers and send a new check. But it's also gone the other way, so I need them to work with me when it's my cash. Also, there's nothing saying the agent or his broker won't contact you 3 or 6 months from now, trying to correct the mistake. What are you going to say then? That you didn't notice?