Q & A - How do I Get My Earnest Money Returned?

 

Seller - we saw the home we THINK is the home of our dreams, but it looks like it was not taken care of by the Sellers.     If we find something we cannot live with, are we able to get out of the contract and get our earnest money returned?

Earnest Money

GREAT Questions!    With our strong seller's market, you will find many buyers writing on homes and not convinced this IS THE HOME.   Maybe the spouse has not seen the home, but you don't want to lose it.

In Colorado a buyer does have the ability to opt out at inspection WITH NO REASON.    In the Colorado Contract to Buy & Sell, paragraph 10 gives the buyer the option to ask for repairs or to terminate.   If the buyer asks for items, and the Seller does not agree, the buyer can terminate the contract.    If the buyer opts out, the earnest money will be returned.

If the appraisal does not come in at contract price, three things could happen.    The Seller reduces the price to the appraisal price, the buyer could bring the difference to closing, the buyers and sellers could split the difference, or the transaction can be terminated.     If the options do not work for the buyers and sellers, the buyer can terminate and get their earnest money returned.

The final reason a buyer would get their earnest money back is with the Loan Objection (paragraph 5.2) where the buyer has the right to review the financing for their loan.    If they are not satisfied with the loan lock or terms of the loan, the buyer can terminate and get their earned money returned.

 

The Buyer's Agent is required to stay on top of these dates, and keep the earnest money protected.    Communication is key --- to keep the lines of communication open and know what is going on with the home and with the Buyers' loan.

 

I have worked with many buyers over the years, and take the earnest money very seriously.    Call me if you are ready to purchase a home!