Timeline for What is the point of "earnest money"?
Current License: CC BY-SA 4.0
20 events
| when toggle format | what | by | license | comment | |
|---|---|---|---|---|---|
| May 23, 2023 at 15:14 | answer | added | Yakk | timeline score: 4 | |
| May 21, 2023 at 17:30 | answer | added | TTT | timeline score: 2 | |
| S May 19, 2023 at 17:05 | history | suggested | sjy | CC BY-SA 4.0 |
extract relevant due diligence clause wording from comments
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| May 18, 2023 at 14:24 | review | Suggested edits | |||
| S May 19, 2023 at 17:05 | |||||
| May 18, 2023 at 4:43 | comment | added | user541686 | This might be a better question for Law.SE than Money.SE. | |
| May 18, 2023 at 3:45 | comment | added | Nelson | The contract does not setup rules which a divine-being enforces. It sets up conditions and clauses which gets put through the legal system to see who wins. You can have a blank piece of paper as your contract, but the judge will just throw it out, if it even gets to that. Just because it is in the contract, doesn't mean it can be legally enforced (e.g.: some Software EULAs are actually not enforceable). Likewise, it's up to the courts to decide whether the clause is valid. You may lose and would have to fork over the money. | |
| May 18, 2023 at 2:45 | comment | added | user662852 | Is there otherwise language in your agreement that identifies the value of the earnest money as "liquidated damages" to the seller in the event of a buyer breach? The seller may end up with a claim to pull it out of escrow before you exercise your "sole discretion". | |
| May 17, 2023 at 23:19 | answer | added | gomennathan | timeline score: 2 | |
| May 17, 2023 at 16:27 | comment | added | littleadv | @user26460 I had heard stories of buyers going to court to get the earnest money back even when they had contingencies. When the market is hot and it's easy to get backup offers sellers won't make a stink. But when a house sits on the market for a year and you were the only potential buyer - be very careful about backing out. | |
| May 17, 2023 at 15:44 | comment | added | user26460 | I've heard no story of a buyer losing his earnest money, but I've heard many stories of a failed deal. Take that as an anecdote, not an endorsement of your impression. | |
| May 17, 2023 at 13:49 | answer | added | kdgregory | timeline score: 17 | |
| May 17, 2023 at 12:07 | comment | added | Philipp | @keshlam What it says to a lawyer doesn't matter either. The question is what it says to a judge. But a lawyer might give a very good estimation what the average judge would think. | |
| May 17, 2023 at 3:22 | history | became hot network question | |||
| May 17, 2023 at 1:03 | comment | added | keshlam | What it says to you doesn't matter. The question is what it says to a lawyer. | |
| May 16, 2023 at 20:32 | answer | added | mhoran_psprep | timeline score: 19 | |
| May 16, 2023 at 19:50 | answer | added | littleadv | timeline score: 16 | |
| May 16, 2023 at 19:47 | comment | added | Mason Wheeler | To me that bit about "sole discretion" says "if Buyer really wanted to act in bad faith, they could simply wave their hand and say 'I don't like the Due Diligence results,' walk away from the whole thing, and get the whole deposit back." There are a handful of similar clauses, but this is the most open-ended one. | |
| May 16, 2023 at 19:46 | comment | added | Mason Wheeler | @user102008 "If Buyer determines, in Buyer's sole discretion, that the results of the Due Diligence are unacceptable, Buyer may either: (i) no later than the Due Diligence Deadline referenced in Section 24(b), cancel the [contract] by providing written notice to Seller, whereupon the Earnest Money Deposit shall be released to Buyer without the requirement of further written authorization from Seller." | |
| May 16, 2023 at 19:35 | comment | added | user102008 | "it makes it clear in several different places that we can back out, more or less at any time and for any reason or no reason at all, and unconditionally get 100% of the earnest money back." Are you sure? Usually you can get earnest money back for only certain reasons, e.g. being denied the mortgage, finding flaws with the house, etc. | |
| May 16, 2023 at 19:21 | history | asked | Mason Wheeler | CC BY-SA 4.0 |