Once an offer has been made that's agreeable to both parties, the completion of the sale is usually contingent on two things. First, it's necessary for the buyer to receive the necessary financing. Second, the buyer must be satisfied with the condition of the property. If either of these criteria aren't satisfied, there's a good chance that the transaction will be cancelled. For the transaction to be cancelled, both parties must consent to sign a 'mutual release'. This is simply a formal document stating for the record that the sale wasn't completed. Occasionally one side will refuse to sign the mutual release because they dispute the grounds of fault. If this is the case, the deposit is held by a court order. A lawsuit must then be filed for the court to rule on how the deposit is to be disbursed. For more details about canceling a transaction with a mutual release, contact a real estate lawyer in your area.