Location: Wake County, N.C.
So my wife and I signed and paid $1,000 to a homebuilder to begin the process with them, pending bank approval, of course. We were not approved, and the contract says the “Deposit Refundable- Pending Bank Approval”. We were not approved. He is telling us we were conditionally approved, but the contract doesnt say “pending conditional approval”
The lender wanted us to pay off some of my wife’s debt first, sent us a plan for paying it off, but stated if we did so, we MIGHT be approved. We dont want to pay all of that debt at once. We have savings, but don’t have enough to just throw over half of it away to pay off debts when we don’t even know if the land will percolate (We have that scheduled about a month from now). The builder hasn’t started any process that would mean a lost profit for them, other than the prices of paper they have printed out for us, etc. Essentially, nothing has been done yet because we need to get permits from the county, etc. The land os all trees, uncleared, raw land. And this cannot be done within the 90 day closing window, as we wont have the debt paid by then, as we are over 30 days in right now.
Could we take a risk and pay it off? Yes, but that would not leave us any room for any unexpected large expenses related to any of this process, including any additional surveying etc. that needs to be done.
Anyways, the owner of the business called us today, and essentially gave us two options: He keeps the grand, which he clearly doesn’t need, given the next option: He sues us for not fulfilling “contractual obligations to build with them.”
The langauge in the contract is extremely open, vague, and according to a lawyer who reviewed it, he said their contract needs lots of works, because it’s pretty bad.
Part of me says to just let him keep the grand, and he said he won’t ask for the remaining 1800, which would total 2,800.
Part of me says this in unethical as hell, and a scare tactic, and that he’s bluffing. He told us “Well, thats the thing about this world. You can sue anyone for anything, and you might win, you might not. But if I take you to court, youre gonna spend 30 to 40 thousand dollars. So you can email me saying we can keep the 1,000, or I can take you to court.”
I asked him “So, man to man, you’d be fine spending 30-40k on us over a grand?”
He replied “Yeah, I don’t mind spending 30,000 dollars.”
I then said “Okay, so our plan was to use the grand, pay off a portion of the debt, and then come back and do business with you in the future.”
He said “We are not longer interested. But we need to make a decision here. I can keep the 1,000 and we’ll never hear from each other again, or I can take y’all to court. Your choice.”
My wife and I are at a loss as to what to do here. This is predatory, and my wife said that she read a review of the owner telling someone in a similar situation that they can have their 1,000 back if they promise to build with them within a year.
Anybody know what to do? That part of me that says to leave it is strong, but so is my desire to syand up to this type of bully, and bring them down. Currently considering contacting the NC Attorney General’s office about this.
Also worried the guy will use our personal info provided in the process against us in a malicious manner as well. No idea what kind of connections he might have, and if he’s willing to spend 30k over a grand, what else will he spend money on? A hit? Lol who knows. Just a thought.
Comments
let him keep the grand you’re unwilling to “try” and get qualified anyway.
NAL, but I’m pretty sure this is extortion in a stretched out format.
You have a contract, which above all, says “Refundable, pending bank approval”.
The bank hasn’t approved you, so you can’t do business.
If your lawyer says it’s open, did you get them to review before you signed or after?
Tbh it sounds like a bluff to think they are gonna 30k-40k on lost earnings, it’s a huge gamble.
I’d tell them to fafo and make sure to advertise as much as much as possible online of the situation.
First, report him to your state AG and BBB. Write some nasty Google reviews. Establish some consequences for him for his behavior. And then, file against him in small claims. Now there’s consequences, and a venue.
This is obviously not his first rodeo with this kind of scam. He’s relying on it not impeding his business in any way. If he gets a highly public reputation for working this way, that will have business consequences for him.
There’s also a lesson here for you — don’t enter into deals with someone whose reputation you don’t know or haven’t verified.
He isn’t going to spend 30k+ on suing you. He is a businessman and a scam/con one at that. Above all he loves money. He isn’t gonna waste it.
He is bluffing you and swinging his business as his balls to smack people in the face.
Report to AG and sue him or take to small claims. Personally I’d get a lawyer and make him pay your lawyer fees.
Did you get any of this in writing, or was it all verbal?
Also North Carolina is a one party consent state, so I would try to get him to admit all this while recording him.
Then if he does sue you, you have evidence of him extorting you. Should be easy enough to have the court award you attorney fees in the event he sues.
NAL
On principle alone….
I hope you’re documenting all of this on paper with time, date, conversation. If so, start the process first, take him to small claims for the grand since he hasn’t returned it and since he threatened you. The outcome of the small claims court case, which you’d most likely win, will greatly reduce his ability to sue you for it after. Then, if communications continue to happen, you can go after him for harassment.
^ ask a lawyer about this approach. Your goal is to cut his legs out from under him for future action.
I wrote out a template of how I’d respond do this, then I had ChatGPT make it sound a bit more.. legal.
“Thank you for the conversations we had on [Date(s)] at [Time(s)]. I’m writing to formally document our situation and to reiterate our position regarding the $1,000 deposit associated with the contract we signed.
As you are aware, we were not approved for financing, and per the contract—which clearly states “Deposit Refundable – Pending Bank Approval”—we are entitled to a full refund. We did not receive final approval, nor are we under any conditional obligation to proceed, especially given that additional debt payoff was suggested without a guarantee of loan approval.
I found our last conversation concerning. Your statement that you were willing to spend $30,000 to sue us over a $1,000 refund, coupled with the implication that we must agree to let you keep our deposit or face litigation, was both surprising and inappropriate. As you said, “You can sue anyone for anything,” but I trust that you also understand that such threats, particularly when documented, are not viewed favorably in court or by consumer protection authorities.
Despite this, I would prefer to resolve this matter amicably. Therefore, I am requesting that you return our $1,000 deposit within [7 or 10] business days from the date of this message. If the funds are not returned within that timeframe, I will initiate a claim in small claims court and file a formal complaint with the North Carolina Attorney General’s Office – Consumer Protection Division, as well as the Better Business Bureau, NC Licensing Board for General Contractors and applicable contractor licensing boards if relevant.
Please consider this our final attempt to settle the matter informally. I am attaching a copy of the signed contract for your reference.”