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Getting conflicting reports. What happens to the earnest money if I withdraw my offer?

I've got a broker who says I get it back 100% if at anytime, the seller, or I terminate the negotiation. I've got a lawyer saying that's not true; the money is mutually owned once it goes into escrow, and I would have to negotiate a fair settlement with the seller. All I want is to see the businesses financials, to confirm the owners claims. If true, I'll buy. If not, I'll withdraw my offer.

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Answers (2)
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It depends on what is agreed upon at the time the earnest money is put into escrow & it must be in detailed writing.

Feb 15, 2016
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The BAF Group LLC

Every Broker does things differently. In our practice, you do not need to make an offer or put money on deposit, in order to see the financials. How can you make an offer if you do not know the details of what you are trying to buy? That is like asking you to put up money before trying on a suit.

As for the comments of your attorney, I would bank on his/her advice, rather than free information on the Net! The answer is found in whatever agreement you sign - whether it is a Letter of Intent or a Contract of Sale - that iaccompanies the placing of the money in escrow. But if you cannot walk away from it with certainty, I would not put the money up in the first place, at this point in the process.

Jan 18, 2016

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