How can I get my earnest money returned from the seller, if my bank rejected the loan a week before the closing date?
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How can I get my earnest money returned from the seller, if my bank rejected the loan a week before the closing date?
They (the seller) refuse to return it.
Asked on December 17, 2012 under Real Estate Law, Wisconsin
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
If there was a finance contingency in the agreement of sale and you were still within the period to exercise it (which is, however, unlikely; most finance contingencies expire long before the week prior to closing), then you would be entitled to the money back. Otherwise, though, you probably are not: if you could not close, then you breached the agreement of sale; a breach of the agreement entitles the seller to keep the earnest money as "damages," or compensation.
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