Do you get earnest money back if inspection fails?
So long as you notify the seller of your intent prior to the deadline and by the method specified in the contract, you should get your earnest money back in full.
If you are past the inspection deadline, though, it is possible that your earnest money may not be refundable.
What happens to earnest money if buyer backs out?
If the buyer backs out just due to a change of heart, the earnest money deposit will be transferred to the seller. You also need to watch the expiration date on contingencies, as it can impact the return of funds. A good contract with proper contingencies is essential in protecting your earnest money deposit.
At what point do you lose your earnest money?
After the due diligence period, the buyer can still get their earnest money back if they get declined for their loan for any reason. Financial contingencies, on average, run between two and three weeks from the binding agreement date.
When can a seller keep earnest money?
The earnest money can be held in escrow during the contract period by a title company, lawyer, bank, or broker – whatever is specified in the contract. Most U.S. jurisdictions require that when a buyer timely and properly drops out of a contract, the money be returned within a brief period of time, say, 48 hours.