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Dippedin67, Home Buyer in Chicago, IL

Where's our earnest money check?

Asked by Dippedin67, Chicago, IL Sun Aug 23, 2009

My husband and I bidded on a short sale. Two weeks later, I drove by and noticed that the For Sale sign had been removed from the property. My husband called "his realtor" and she was clueless. My husband finally got in contact with the agent for the house who was also somewhat clueless but stated that he thinks that the bank took it. Bottom line, where is my husband's earnest check? Should he request that it be returned? Thanks much.

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Answers

5
I dont know why your agent submitted the earnest money before the offer was accepted. I always just send a COPY of the check. I dont think its a smart move to send out an earnest money check unless your offer has definitley been accepted. Why is your agent "clueless?" I dont think the bank has gone and stole your money. However, I would call your agents managing broker to get this issue resolved asap. Its not a huge ordeal getting earnest money released, but you dont want to wait around to long for it. Did you get any sort of proof from your agent that you gave them earnest money? A copy, a receipt, etc.

Matt Laricy
Americorp Real Estate
Brokers Associate, e-PRO
mlaricy@americorpre.com
708-250-2696
0 votes Thank Flag Link Tue Aug 25, 2009
Who was your check made out to? Go to your bank and find out when it was cashed as a first step and as a second step call your agent's broker and demand answers. Your agent should not be "clueless" as you state and should be acutely aware of things like where in the process the transaction is and who is holding your earnest money.

The excuse that the bank took the property over all makes no sense. Banks do not move forward with foreclosure proceddings while simultatenously trying to negotiate a short sale. In fact, they are forbidden from doing so and when a short sale negotiation is under way everything else stops.

Definitely contact your lawyer immediately and be prepared to stand up for yourself as it sounds like this deal was an unorganized mess by all the profesionals involved.

Scott Newman
0 votes Thank Flag Link Mon Aug 24, 2009
The first question is whether your check was cashed. (If not, stop payment and forget about it.) It would not normally be cashed until all parties have reached agreement and the contract has been signed. In that case, it is typically held by the brokerage firm that has the property listed for sale. The check is never made out to the seller or the bank.

Assuming you reached agreement and the check was deposited into an escrow account by the listing broker, and now your purchase is not moving forward, you are entitled to get that money back.

As the broker mentioned below, in order for it to be released, both the buyer and the seller need to sign a release form. Once signed, the listing broker should process the request and return the funds to you. If the broker cannot find the seller to get a signature on the form, you are in a bit of a pickle. At that point, I would call your real estate attorney and ask for a suggestion regarding next steps. Unfortunately the cost to compel someone to sign the release may be more than the amount of your initial earnest money check.

Best of luck,

Jenny
0 votes Thank Flag Link Sun Aug 23, 2009
Our earnest money check was sent with the offer. We never heard anything, except that the bank probably took over the house, in foreclosure.
0 votes Thank Flag Link Sun Aug 23, 2009
When you say you made a bid, I assume your offer was accepted by the seller and was sent to the bank to approve. Normally you do NOT send Em at this point in time, but since you did, just have your agent have you sign the standard Release of EM form and sends it to the other side.
The owner of the property and that agent should have the loan # and can call the bank using that number to find the status.

philip
0 votes Thank Flag Link Sun Aug 23, 2009
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