Can the seller keep my deposit if I back out?

Buyers tend to treat the deposit as the worst case of walking away. It is the first consequence, not the boundary of the exposure, and the distinction between a conditional and an unconditional agreement is what decides which applies.

Terminating under a condition is not backing out

If financing, diligence or landlord consent remains unsatisfied and the agreement allows termination, exercising that right is performing the contract rather than breaching it. Do it in the form and within the time the agreement specifies — a termination given late or informally can be ineffective, which turns a clean exit into a breach.

After waiver, the deposit is the floor

Once conditions are waived the buyer has agreed to complete. Failing to do so generally forfeits the deposit, and a seller who then sells for less, or incurs costs keeping the business on the market, may claim the difference. In principle a seller can also seek to compel completion, though on small transactions damages are the usual route.

The deposit terms themselves matter

Who holds it — a lawyer in trust rather than the seller directly — what it is credited against, and on what events it is released or returned. A deposit held by the seller personally with no stated release conditions is a dispute waiting for a reason, regardless of who is ultimately right.

If you need out after waiver, say so immediately

The realistic outcomes are a negotiated release, an extension, a price reduction, or vendor financing covering what you cannot fund. Every one of them needs the seller’s cooperation, and a seller told weeks ahead is far more cooperative than one told on the closing date.