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We found a house we loved, our offer was accepted and we had the home inspection. We removed the inspection contingency and asked the seller to make a few minor repairs, then went to get a mortgage commitment. Now it's clear we're not going to get a mortgage, after my husband changed jobs post-pre-approval letter and the income, while better for us in reality, is not as steady on paper. We've exhausted our options and decided to walk away, but are confused about the earnest money and how we can compensate our agent, who was great, despite there being no actual sale?
Do buyer's agents expect a compensation in a situation like this - it only seems fair, to us, but we're not sure what the etiquette is. He only showed us this house, but held our hands up to this point. We would love to work with him in the future but will have to wait at least a year before our finances are acceptable for banks again.
Also, do we forfeit the earnest money if we walk away now? And where does that go?
Since you lost your financing, you should get your earnest money back. It may take a little time but shouldn't be a huge deal.
It's very nice of you to want to offer the agent some money. I know it will be appreciated. The check will need to be made payable to the agency, rather than to the agent personally. There is nothing manditory about the amount - make it whatever you wish.
On behalf of buyer's agents everywhere ... Thank you!
If your agent wrote on offer that did not allow you an out if you failed to obtain financing they ought not get rewarded but castigated!
Any exchange of earnest money should be accompanied by a contract with a clear list of legitimate outs. THE NUMBER OUT is failure to find financing!
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