What to do about a delay in closing and trying to get our earnest money back?

We are home buyers, however the house cannot be closed on time due to a loan processing delay. We requested that the seller extend but with no luck even though we accepted seller’s very strict terms. During the whole loan processing, we timely submitted all requested documents. We didn’t do anything wrong. The loan delay is out of our control. Is there any chance that we can get the earnest money back? By the way, we have 27 days to give seller written notice if we cannot obtain the credit approval. However, this date is already passed and at that time we already got the commitment approval from lender.

Asked on September 23, 2015 under Real Estate Law, Texas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, unfortunately, you can only get your earnest money or deposit back if 1 there was a finance contingency in your contract, allowing you to get the money back if financing fell through and 2 you complied with all the terms, including especially the end-date, of such contingency. If you had such a contingency, but are past the date by which you had to pull out of the sale, then the seller would be allowed to keep your deposit.


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