Expert: William Cady Date: 6/20/2007 Subject: TX Refund of earnest money without seller acceptance?
Question OK, so here's the short situation. We put an offer on a house. We sent the owner a $100 good faith deposit, and put $2000 in escrow as an earnest money deposit. In the contract, we had a 3rd party financing adendum. We were not able to secure 3rd party financing for the property for a variety of reasons. After exhausting every method we could to get it financed, I had to call the deal DOA and cancel the contract. The seller refused to sign the earnest money release and now the escrow company will not release it without his signature. We clearly were within our sales contract rights to do cancel and expect the return. In the contract, there is an agreement to go to a mediator before suing. My question is can something be done with the escrow company to release funds without mediation? The buyer and seller must split mediation costs but I don't feel that I should be held liable for this at all since it was stated in the contract and signed by both parties. What can I do?
Answer I'm going to have to ask you a couple of questions before I can answer:
Is the seller wanting to keep the $2000 of earnest money?
Did you terminate the contract during the option period (I am assuming that you bought one) or before the number of days specified in that first block on the third party financing addendum?
Just out of curiosity, what is your agent telling you?
