- What happens to a purchase deposit depends mainly on what your signed agreement says and why the deal ended.
- Saskatchewan's rental security deposit rules are written for landlords and tenants, so they are a separate topic from a home-purchase deposit.
- Do not sign a release until you understand what it gives up, and keep every document and message about the deal.
You put money down on a home, and now the purchase has collapsed. Maybe financing fell through, an inspection went badly, or one side changed its mind. The first question is almost always the same: do I get my deposit back?
The honest answer is that it depends on your signed agreement and on why the deal ended. This article explains the questions that matter, how a release usually fits in, and how a purchase deposit differs from the rental security deposit rules that often show up in searches.
This article covers the law of Saskatchewan.
Start with your signed agreement
A purchase deposit is money paid toward the price to show you are serious. What happens to it if the deal ends is mostly set by the contract you signed, usually an offer to purchase and any amendments or conditions attached to it. Two deals can look alike and end very differently because of a single clause.
Read the agreement for the following, and bring it to any advice appointment:
- The amount of the deposit and when it was due.
- Who is named as holding it.
- Each condition (for example financing or inspection) and its deadline.
- Whether you gave notice that a condition was not met, and when.
- What the agreement says happens to the deposit if the deal ends.
Who holds the deposit and when it moves
Who holds a purchase deposit, and what they need before they pay it out, depends on your agreement. Whoever holds the money may ask for clear written direction before releasing it, and how that works in your case is worth confirming with a lawyer. Check your agreement to see who is named and what instructions they must follow.
If a condition was properly dealt with within its deadline and the deal ended as the agreement allows, the return of the deposit is often straightforward. If the reason for ending is disputed, for example the seller says you missed a deadline or you say the seller failed to deliver something, the money may stay where it is until the disagreement is settled. Whether a seller may keep all or part of a deposit turns on the agreement and the facts, and it is worth confirming with a lawyer before you rely on any assumption.
How a release usually works
A release is a short written document, signed by the people involved, saying the deal is over and directing who receives the deposit. The person holding the money often asks for one so they are protected when they pay it out.
Before you sign one, check these points:
- Does it say exactly who gets the deposit, and how much?
- Does it also cancel other claims you might have, such as for costs you paid?
- Does it require you to give up rights in exchange for getting your own money back?
- Is the date, property address and every party's name correct?
- Has everyone who must sign actually signed?
In a standard Law Society offer-to-purchase template, each party pays their own lawyer. Who bears the cost of work on a deal that ends depends on your agreement and situation, so it is worth confirming with a lawyer. A lawyer can often review a release quickly, which is usually cheaper than fixing a badly worded one later.
Do not mix this up with a rental security deposit
Searches about deposits often land on residential tenancy rules. Those apply to a landlord and tenant, not to someone buying a home. They are useful only to show how different the systems are.
| Point | Rental security deposit in Saskatchewan |
|---|---|
| Size limit | No more than one calendar month's rent |
| Timing | At most 50% at signing, the rest within two months of possession |
| Return or claim | Landlord has seven business days after learning, or reasonably should have known, that the tenant has vacated, subject to s. 32(5) |
| Dispute | Tenant applies to the Office of Residential Tenancies within 60 days of the tenancy end date, with a $50 filing fee |
None of those limits or deadlines is a rule for a home-purchase deposit. If you are in a dispute over a rental deposit instead, the Office of Residential Tenancies process above is the one that applies.
What to do next
- Gather the signed offer, all amendments, condition waivers or notices, and every email or text about the deal.
- Write down the dates: when you signed, when conditions were due, and when the deal ended.
- Find out who is holding the deposit and ask them in writing what they need before releasing it.
- Do not sign a release or any cancellation document until you understand it.
- Speak with a lawyer if the other side disputes the return, if a deadline is close, or if the release asks you to give up more than the deposit.
Frequently asked questions
Does the seller automatically keep my deposit if I cancel?
Not automatically. It depends on what your agreement says and whether the deal ended in the way the agreement allows. If the reason for cancelling is disputed, the money may be held until the disagreement is resolved, so it is worth having a lawyer read the contract.
Who normally holds a purchase deposit?
That depends on your agreement. Check the signed offer to see who is named as holding it, and ask them in writing what they need before they will release the funds. A lawyer can confirm how this applies to your deal.
Do the seven business day rules apply to my purchase deposit?
No. The seven business day period applies to a landlord dealing with a tenant's security deposit. It is not a rule for a home-purchase deposit.
Should I sign a release the other side sends me?
Read it carefully first. Check who receives the money, whether it cancels other claims, and whether everyone has signed. A lawyer can confirm what you would be giving up before you sign.
Sources
- Government of Saskatchewan – Security Deposits — saskatchewan.ca
- CanLII – The Residential Tenancies Act, 2006 — canlii.org
- Law Society of Saskatchewan – Offer to Purchase — lawsociety.sk.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
This is a real estate question
A home purchase with us is from $1,437.89, tax included. Third-party fees are extra.