Who should get the deposit/earnest money

[snowmountains]

I wonder how the OP solved the problem with that buyer. I'm sympathetic to him. If I were the seller I would definitely want monetary compensations for the loss. On the other hand, if I were to buy a house and if the regulation is such that I won't get EMD back even if it's solely due to financing contingency, then I may think 100 times before signing a contract. I think the best way would be pay all cash.

[Tish Thompson]

If I were your agent and everything happened as you said, I would pursue keeping the EMD.

Based on your description, the buyer had a specific amount of time to lift the finance contingency. When she went beyond the allotted time-frame without continuing or lifting the contingency, I would have contacted you to ask you if you were OK with that. If it wasn't OK, I would have asked the other agent for an addendum to continue or lift the contingency. If the agent didn't respond, I would have served the other agent with a notice of default and on it would be a list of things the buyer would have to do to remedy the situation. At the end of the notice would be a reminder that the buyer would forfeit her EMD if she didn't act.

I'm a nice agent...but I'm aggressive. Even though I believe in enforcing the contract, I find that most of my clients don't want to "rock the boat" so they don't pursue EMDs.

Originally Posted by joseph2009

As a home seller i have been lucky enough to get a buyer .
HOWEVER, 4 days before closing buyer backs out.
we passed home inspection(after monetary concessions to address home's issues) she signed off on inspection and accepted the cash instead.. we passed appraisal. she sent over furnace "expert" to evaluate older furnace.
he said it was in fair condition. she accepted. AND THEN..
she said she did not meet mortgage contingency .. she did not receive written commitment mortgage letter... she missed due date .. did not diligently pursue a mortgage or letter of commitment (change banks 3 times during process ,not because of denial .. just because she was indecisive of banks.) and then one day b4 mortgage contingency date , 4 days b4 closing , she said she did not get the letter.. not because she was refused, she just didn't get it...and wanted out of the contract.. buyers remorse...and in the interim she asked her agent to start showing more houses.. she is a more than qualified buyer and was not refused...
she has not offered a letter of denial and through her lawyer she just says she rescinds her offer.... we hired moving trucks , rented home 1500 miles away and sold 25 % of furniture. Even rented hotel room for drive to new home with animals.
we plan on letting her just bring lawsuit to sue us for the monies although we dont even have the money.. in escrow and can not be released until mutual release agreement is signed.
we dont want to go to litigation although we feel right.. we would rather go to mediation or arbitration.
question... by law .. are you required to show proof of denial from banking institution when backing out of a deal?
and... who should get that earnest money ?
thank you in advance.....