earnest money at closing

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Few people told me that I can get the earnst $$$ back at closing if seler contribution covers more than closing cost. My seler is agreing to pay upto $4400 & closing costs are estimted to be about $3900. Now my broker is saying that I will have to come up with at least $500 & when I asked if I would get it back she said I won't even when seler is oferring to pay more than what closing will be actually for. Its a fannia mae loan. Any ideas?

miller_st · Joined: 17 Jan 2007 Posts: 917 168.82 Dollars($)

I don't know which Fannie Mae loan you have but for Fannie Mae Flexible 100 program it is required for the buyer to make $500 contribution towards closing costs.

And you can only get back what you contribute. If the seller is contributing $4400 and actual comes to $3900 then the excess will return back to the seller. At closing you can only get back the amount of your contribution and not more than that.

Miller

Niicss · Joined: 03 Oct 2005 Posts: 1047 156.17 Dollars($)

Your seller is putting in $4400 for your closing costs and if actual costs stand at $3900, then his contribution will be up to $3900 and the balance will return back to him.

If your mortgage is not Flexible 100 program but some other program like MyCommunity loan which does not have any minimum borrower contribution, and you put earnest money $500, you will be getting that back if all closing cost is covered by seller's contribution.

But as Miller said it is likely a Flex 100 as you are required to bring in $500.

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi Stewart,

During the transaction, have you signed any agreement either with the seller or the broker that you will get back your earnest money back at the time of closing? In some cases, the deposit is often refunded to the buyer and is used as a credit toward closing costs. So, carefully read your contract as the laws vary from state to state. In that case, if the seller refused to return the deposit without any cause, the seller could end up paying a penalty to the buyer.

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if you be interested stewart - fannie mae flexible 100 program :- curealty.org/fannie_mae_flexible_100_programs.htm

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