Q: I am one day away from closing on a home, but underwriter denied the loan .how can i get my earnest money deposit back ?
A:
If your earnest money contract included the standard Third Party Financing Addendum and the box at the top of section 2 A is checked, obtaining Buyer Approval by the financing entity was a condition precedent and you are entitled to give notice within the days specified in that section terminating the contract and you will receive a full refund of the deposit. If the bottom box in section 2 A is checked, you agreed that your obligation to purchase the Property was not conditioned on your loan being approved. Similarly, if you did not give notice of cancellation within the number of days set forth in section 2 A, you gave up your right to cancel the contract and receive a full refund of your earnest money deposit.
Assuming you are entitled to a refund of your earnest money deposit, give timely notice to the escrow agent of your termination of your earnest money contract and ask the escrow agent to refund your deposit.
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