About Eric Sexton Expertise All aspects of buying and selling homes including: General real estate questions, Contracts, Negotiations, surveys, title work and general questions about mortgages. I CAN NOT GIVE LEGAL ADVICE AND WILL NOT BE ABLE TO ANSWER QUESTIONS WHERE LEGAL ADVICE IS NECESSARY.
Experience
I have been a real estate agent for 6 years and a broker for 2 years.
Organizations National Association of REALTORS and Texas Association of REALTORS.
Expert: Eric Sexton Date: 6/26/2007 Subject: earnest money
Question My husband and I are working with a real estate agent to sell our house. We had a contract with buyers who were also represented by a real estate agent. Our closing date was to be 6-14-07 at 9:00 AM, so we had completely moved out of the house 6-13-07 since we had not had any notice of any pending problems. On the evening of 6-13-07 the buyers' agent asked for an extension date of 6-18-07, which we granted. The buyers did not close the deal as of midnight on 6-18-07 nor did they ask for another extension. Two days later (6-20-07) their lender finally notified the buyers that their loan was not approved because the appraisal was rejected (not the value, but the fact that the comps were more than 5 miles away from our rural property). Now the buyers want most of their $3K earnest money back even though they let the contract expire without making other arrangements. We are not inclined to release the money to them as we have spent $5K moving out of our house. Who is entitled to this money? I would think that we would get it because the contract was expired two days before receiving any kind of notice from the lender that they were rejecting the appraisal. Thanks for your help.
Answer Janice,
I sympathize with your situation. This happens all too frequently. It is often not until a few days before closing when "last minute" news arrives regarding problems with the buyer's loan approval.
There are many different interconnected legal aspects of the standard Texas contracts (closing dates, contract default, notice time frames) that real estate agents are unable answer because they aren't lawyers.
Given the dollar amount involved I would strongly suggest you contact a real estate attorney. An attorney will often evaluate your case for little or no fee.
