How can I get my earnest money returned from the seller, if my bank rejected the loan a week before the closing date?

UPDATED: Dec 17, 2012

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

UPDATED: Dec 17, 2012Fact Checked

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

How can I get my earnest money returned from the seller, if my bank rejected the loan a week before the closing date?

They (the seller) refuse to return it.

Asked on December 17, 2012 under Real Estate Law, Wisconsin


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

If there was a finance contingency in the agreement of sale and you were still within the period to exercise it (which is, however, unlikely; most finance contingencies expire long before the week prior to closing), then you would be entitled to the money back. Otherwise, though, you probably are not: if you could not close, then you breached the agreement of sale; a breach of the agreement entitles the seller to keep the earnest money as "damages," or compensation.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption