Property Q&A in Chicago>Question Details

Cfolk8544, Home Buyer in Frankfort, IL

Can I get my earnest money back because I was denied a loan?

Asked by Cfolk8544, Frankfort, IL Fri Nov 30, 2012

Before closing on a short sale purchase I was laid off of my job and my loan was denied. Can I get my earnest money back?

Help the community by answering this question:

Answers

16
It really depends all on the terms of your sales contract. If you had a loan contingency, and the denial from the lender came within the time frame, then with a letter from the lender you should be able to
get your earnest money back. I hope you did not do the purchase / offer etc. on your own but you had
an experienced Realtor, a buyers agent on your side, to guide you to make sure the terms in the
contract consider your situation and financials and that hopefully an attorney was consulted to review
the contract.

Double check with your Realtor and or your real estate attorney....
Good Luck to you

Most Sincerely yours,

Edith YourRealtor4Life
Working always in the very BEST interest of her clients
EdithSellsHomes@gmail.com
http://tinyurl.com/YourRealtor4Life
@Properties Relocation and worldwide Services
FRENCH, GERMAN, SPANISH +
Free Market Evaluations & daily new listings for Buyers/Investors
0 votes Thank Flag Link Sat Dec 1, 2012
You should have had a mortgage contingency in your contract and it is within the time allotted. If so, yes, you need to provide a copy of the loan denial and cancellation with earnest money request form.

If you have an agent, ask them for the form. If not, have your attorney inform the seller's attorney or contact the listing agent.
0 votes Thank Flag Link Sat Dec 1, 2012
If your financing contingency is still open, then yes. That shouldn't be a problem.

Best of luck,

Ivan Sagel
0 votes Thank Flag Link Sat Dec 1, 2012
The answer to your question is yes if everything has been performed within the number days allotted in your contracted and depending on how the financing contingency has been written in your contract. If you contract has allowed for the owner to obtain financing on your behalf and the owner wants to finance the property for you that may change the picture. Talk to the attorney representing you. You paid your attorney to protect your interest in the deal! The attorney will have all the terms of your contract and you broker should have a working understanding of your contract.

Best of luck, I am sorry your financing feel through.
0 votes Thank Flag Link Sat Dec 1, 2012
please fire your agent as soon as possible..this is a silly question for you to have to ask,,..you get your EM back if your agent is representing you correctly
0 votes Thank Flag Link Sat Dec 1, 2012
If you used one of the standard R E contracts approved by the state of Il then yes, you should be able to get it back, but this is a legal question. Just ask your attorney.
0 votes Thank Flag Link Sat Dec 1, 2012
What does your attorney say about this issue?
0 votes Thank Flag Link Fri Nov 30, 2012
The attorney you used for the closing as well as your broker can work to get you your earnest money back.






Sohail A. Salahuddin | Broker Associate I Visionary
Innovative Property Consultants Team l Sales and Leasing
Jameson Sotheby’s International Realty
425 W. North Ave. | Chicago, IL 60610
O: 312.929.1565 | C: 312.437.7799 | F: 847.805.6030
"Local Experts, Global Reach"
0 votes Thank Flag Link Fri Nov 30, 2012
Many factors here, you should be asking your attorney and your agent this. There is no way to answer correctly without more information.
0 votes Thank Flag Link Fri Nov 30, 2012
Work with your Attorney/Realtor to have your EM released. Check your contract for the details.
0 votes Thank Flag Link Fri Nov 30, 2012
Consult with an attorney. Generally, the answer is "yes" because most contracts contain a common clause known as the mortgage contingency which allows for cancellation of a contract to purchase during a certain time frame. But, its all dependent upon your particular contract and your own state's law. That is why consulting an attorney will lead you in the right direction.


Rusty A. Payton, Broker
iMove Chicago
1225 W Morse
Chicago, Illinois 60626

773-856-6200 [Office]
773-856-6201 [Fax]
773-682-5210 [Mobile]

e. payton@iMoveChicago.com


http://www.iMoveChicago.com

blog: iMoveBlog.com
0 votes Thank Flag Link Fri Nov 30, 2012
Hopefully, you have an attorney representing you during the purchase and that would be the best person to ask this question - as they are supposed to be familiar with the contract that you have in place to purchase the property. You can check the contingencies that you have with your contract. Typically, there is a Mortgage Contingency that will give you a specified amount of time to secure a mortgage to purchase the property. However, when it's a Short Sale, many real estate agents do untypical things with the contract. Your attorney should provide instructions and information to you, the real estate agents and the other attorney on how the contract should be canceled and how and whom should submit paperwork for the return of escrowed earnest money. Any advice other than to check with your attorney - should be considered foolish. Good luck!
0 votes Thank Flag Link Fri Nov 30, 2012
if it was before your contingency date, you should be able to get your money.
0 votes Thank Flag Link Fri Nov 30, 2012
It depends on whether you already waived your mortgage contingency, assuming you had one in your contract
0 votes Thank Flag Link Fri Nov 30, 2012
Yes if the contract called for it to be CTG on financing.
0 votes Thank Flag Link Fri Nov 30, 2012
You should, as long as you haven't already met your mortgage contingency date.
0 votes Thank Flag Link Fri Nov 30, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer