Buyers missed the closing date, can the seller keep the deposit?

Asked by Koca, 33024 Tue Jul 12, 2011

My buyers missed the closing date due to their lender, we then signed a 3 day extension and they missed that too. Now (30 days) later the buyers want their deposit back. Question: If the closing date has passed, is the contract is dead? Can the buyers still use the financing contingency to get the deposit back? Or can the seller keep it to defray their costs?

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Ron Thomas, Agent, Fresno, CA
Tue Jul 12, 2011
You may have initialed the little box that agrees to Arbitration and Mediation:
If you did, they can request A & M over the Deposit.
You have a BUYER , you have a DEPOSIT, you had a CONTRACT,
why not try to resurect the Deal and write a new contract; you have some leverage!

Is your goal to sell the house, or what?

Good luck and may God bless
0 votes
Shanna Rogers, Agent, Murrieta, CA
Tue Jul 12, 2011
Hi Koca,

If the closing date has passed and there is no extension signed by all parties, the contract is dead. You need to contact a Real Estate Attorney and let them review all your paperwork to see if you are entitled to the ernest money deposit.

Good luck.

Shanna Rogers
SR Realty
0 votes
Merritt Noel, , Denver, CO
Tue Jul 12, 2011
If the dates within the contract are not met than yes the buyers would legally forfeit their earnest money. Per Anna's suggestion I would urge you to review the contract and the deadlines within the contract. It sounds like if they missed the closing and it have been additional 30 days they could very well have no recourse to get back the earnest money.

I am sorry to hear the lender was not able to tell the buyers sooner they could not get the loan approved. I hate it when I hear a lender after 35 days tells the buyer sorry your loan is denied. Any lender should be able to let the buyers now in a reasonable time frame...2-3 days that they could not get them approved for whatever reason that may be. Actually, if the lender provided a pre-approval letter they should have looked at all income and assets before you even when under contract.

To see what the typical loan process time frame looks like check out my blog post link is below.

Good Luck,
Merritt Noel
0 votes
Anna M Brocco, Agent, Williston Park, NY
Tue Jul 12, 2011
What is your agent and or attorney advising; the answer to the deposit can be found in your contract, therefore review the document and make a determination.
0 votes
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