can the bank keep half of my earnest money?

Asked by Vonnie Rodriguez, Houston, TX Wed Feb 6, 2013

my stepmother who had done all the work for me said that the bank had kept half and the reason was the processing fee?? is there a processing fee for a shortsale..i didnt get the house after all and this was since august when she had cancelled for me, however i did not sign anything for cancelling.

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Tommy Burris, Mortgage Broker Or Lender, Baton Rouge, LA
Wed Feb 6, 2013
Earnest money is held by title company. NOT the bank.
Something fishy here.

Tom Burris
Mortgage Banker
(214) 763-4629 cell/text/nights/weekends(Really!!)
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0 votes
Carolyn Wol…, Agent, Houston, TX
Wed Feb 6, 2013
the bank cannot get their hands on the money if the earnest money is held by the title company.
Call the title company first thing in the morning and demand an explanation. They cannot dispurse the Earnest money until all parties agree and sign off on a Release of Earnest money form.

Short sales do have hidden fees that your Realtor should tell you about up front, but they are not paid until closing.

The title company would only charge you for the survey if you had signed something a head of time saying you would. Check your contract carefully.
0 votes
David Compan…, Agent, The Woodlands, TX
Wed Feb 6, 2013
Hi, Vonnie,
Unfortunately, there is not an easy answer to this one. The answer is dependent on the terms of the contract you signed with the bank; whether you gave proper and timely notice of cancellation to the bank and/or title company; which institution was holding your earnest money; and what your stepmother did or didn't do on your behalf to request return of the earnest money. When you chose to cancel the contract, that cancellation may not have been properly carried out, or it may have been contrary to the contract terms. Speaking generally about real estate contracts in Texas: when you have the right to cancel a contract, you must submit to the Seller in a writing (with your signature) a notice of cancellation, along with a written and signed request for the earnest money to be returned (this second document is sent also to the Title Company). Given the number of questions you have right now, it sounds like you may not have been given a clear and full understanding of your rights and responsibilities when you signed the contract; if you were represented by an agent, your agent should have diligently worked to keep you informed and to protect your interests throughout the purchase process.
If you want to resolve this matter, you will very likely need a real estate attorney to review the contract and all related documentation to help determine if anything was improperly handled. Keep in mind, however, that attorneys are not cheap! It may not be worth the cost to involve a legal professional- it's really up to you. Please let me know if you need any referrals for real estate attorneys.
David Companik, Keller Williams Realty The Woodlands
0 votes
Persis Behra…, Agent, Cinco Ranch, TX
Wed Feb 6, 2013
Vonnie, there are too many questions here. Did you call the Title Company to find out exactly what "processing fee" required half of the earnest money? Did they charge you for a survey, or some other request that was to be paid by the buyer? Whose fault was it that you did not get the house - did you decide to back out?

0 votes
Ron Thomas, Agent, Fresno, CA
Wed Feb 6, 2013
Why would a Bank have your Earnest Money?
Why don't you have a Realtor protecting your Interests?
You evidently were under Contract, and then you cancelled.
That's what happens.
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