Home Buying in 60089>Question Details

Peggy, Home Buyer in 60089

How can we get our earnest back if the seller refuses to sign the release earnest money letter ?

Asked by Peggy, 60089 Wed Jun 2, 2010

We had a contract, but we canceled after we could be not able to get a loan. The realtor who is the dual agent put the property back to market. Now the seller refuses to sign the cancellation letter which the realtor prepared and disagreed to release our earnest money. What should we do? is the only way to sue the seller. Or is there a better way to solve this problem? Thanks advance for your advice.

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One thing you did not mention is, Who is in possession of the EM? Is it the Escrow Agent or Broker? If it is the Escrow Agent and you have met all your contractual obligations you should go to them with the proof (documents, time-lines and a Loan Denial letter from your lender) and demand the return. If it is the Broker you should speak directly to the Broker.

This is one of the pitfalls of Dual Agency. The Broker is now torn between satisfying two clients. Unfortunately, you may need to contact an attorney.
0 votes Thank Flag Link Wed Jun 2, 2010
Check your buyer's agency agreement for starters. Is there a clause in it which requires you use an arbitration as a means of conflict resolution? If the two brokers and the sellers cannot come to agreeable terms, arbitration may be your next step.
0 votes Thank Flag Link Wed Jun 2, 2010
Hi Peggy,

This is not the end of the road. I would start with having a lawyer contact the agent to request your earnest money on your behalf. If you are legally entitled to the money, one phone call can do the trick.

Hope it works out for you.

Cherrie Catama
Newman Realty
0 votes Thank Flag Link Wed Jun 2, 2010
If you met the financing contingency deadline, then the seller is not entitled to keep the earnest money. If you missed the deadline, they may be able to keep all or part.

If the agent is acting as a dual agent, then they need to explain to the seller that they need to release the earnest money.

If the seller won't release the money, you may need to contact an attorney.
0 votes Thank Flag Link Wed Jun 2, 2010
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