However, I notice that you are "from" Alaska...this state may have different rules and contracts than California. Again, talk with your agent for clarification.
The deposit is only at risk after the buyer signs the contingency removal to move forward with the purchase. In California we have 17 days to do the inspections and remove contingencies. If day 17 comes and the Seller have given the Buyers their disclosures, ect on time. The buyer needs to sign the contingencies removal form to move forward. the request for repairs was denied, so the buyer signs or cancels. If they have not signed or won't sign the buyer would be given a notice to perform and they have 3 days to perform per the contract or the Sellers has the right to cancel the sale and put their property back on the market. The deposit goes back to the buyer because they never removed their contingencies. If they haven't ordered the appraisal then most likely the buyer never intended to move forward and they are just wasting time or hoping you will give in and agree to the request for repairs so the deal keep going.
Not getting their own home inspection does not mean they agreed to the properties current condition at all. The only draw back to not paying for your own home inspection is that if the original home inspector makes a major mistake on the inspection the current buyer does not have a contract with the home inspection if things needed to go to court. The buyer would assume all risk.
1) Buyer's offer was submitted using the most recent CAR Residential Purchase Agreement (RPA);
2) There were NO changes to contract terms via addendums;
3) At least one of the Buyer's contract contingencies (inspection, loan, and appraisal) HAVE NOT been removed; then, it is quite likely the EMD will be returned. Note the three contract contingencies above require written and "active" removal - passing a certain date does not typically remove the contingency (REO Addendums may remove the "active" element in favor of a "passive" removal).
You should speak to your agent about whether it's time to send a "Notice to Perform".
You may also want to review Para 14F of the CAR RPA which states:
"If Buyer or Seller gives written notice of cancellation â€¦.A Buyer or Seller may be subject to a civil penalty of up to $1,000 for refusal to sign such instructions if no good faith dispute exists as to who is entitled to the deposited funds (Civil Code Â§1057.3)." The Seller must release the deposit within 30 days per Civil Code Â§1057.3"
( Civil Code Â§1057.3 can be found at http://law.onecle.com/california/civil/1057.3.html )
This is a question your Agent should be addressing and clarifying for you based on what actually occurred. The details and timelines of your contract are unknown; thus, with imperfect information anyone answering this question can only speculate what action should take place.
What is the buyers agent telling you? Are they communicating with you at all?