19,780
In Chicago, the earnest money is depositied with the seller's brokerage so the seller has to sign off to give the brokerage firm permission to release the funds.
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Brenda Mayette
Glenville, NY
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Debe Maxwell, CRS
Charlotte, NC
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Nina Hollander, Broker
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
1,712,876
One of the best reasons is so you don't get sued for unauthorized action.
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Olga Simoncelli
New Fairfield, CT
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
5,583,328
because the money is not the escrow agent's money to disperse until there is a release allowing them to do so...and instruction as to whom the deposit is to be paid.....
the seller could decide to make the buyer fight for the money!! doesn't mean the seller wins...it means the seller is pissed.... and making the buyer suffer by suing the escow agent for the funds....
it happens!!
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
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Nina Hollander, Broker
Charlotte, NC
613,494
In the old days, buyers that worked with buyer agents, never got their escrow released, so this an attorney suggested and it worked perfectly.
This was the clause:
This contract conditioned on the buyers espress approval of inspections to be completed within 10 days of a mutually accepted contract. Should inspections not be satisfactory to buyer, the buyer will notify the seller within 2 days of the inspection period.
This contract will then become null and void and all deposited monies will be refunded to buyer that same day....and it was...without signatures.
The other thing that we did was send the listing office a notice that the escrow funds would be released on Date and Time unless we heard from them otherwise. Then it was up to them to make a demand on the money.
Eve
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Fred Griffin Florida R...
Tallahassee, FL
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
5,063,555
I think it provides a wrtten direction/authorization to escrow to release the funds. They can't do anything without both parties' agreement in writing
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Brenda Mayette
Glenville, NY
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
809,258
Because brokers or whoever holds the funds have to do what they are instructed by all parties. The broker needs a paper trail of their instruction. If the funds are released and then there is an earnest money dispute the responsible broker is still responsible for the funds whether they have released already or not so most require the signature from both parties to release to avoid any potential issues or disputes. Here in Idaho Title Companies or the Buyer's brokerage hold the funds. -Kasey
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
7,872,843
You need to follow and document the terms of the agreement.
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
1,466,257
Karen Jones Lewis, MBA, Realtor One to complete a paper trail and two, a signed Release officially returns the EMD with everyone's approval.
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Debe Maxwell, CRS
Charlotte, NC
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Nina Hollander, Broker
Charlotte, NC
3,461
The escrow company is not a party to the transaction so they can only release the deposit upon mutual instructions from the buyer and seller.
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Debe Maxwell, CRS
Charlotte, NC
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
2,785,756
This has always been a sticky wicket. Upfront language releasing is wise
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Debe Maxwell, CRS
Charlotte, NC
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Lyn Sims
Schaumburg, IL
2,684,769
If they don't sign, Buyer will have to sue in Court.
If I was the Buyer, I would also sue the Seller for legal costs, and I would sue the Listing Broker.
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Eve Alexander
Tampa, FL
991,952
If it isn't in writing it didn't happen - simple answer ;)
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Brenda Mayette
Glenville, NY
5,117,828
Because it's the law that both parties need to sign off.
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Brenda Mayette
Glenville, NY
511,314
I always find the contract(s) used in different states to be something of a learning experience. They can be very different. Here in AZ our contract is very robust (10 pages) and covers almost any eventuality. Our contract is very Buyer friendly. Since we do not use attorneys in most transactions we rely on the escrow company to use the contract as instructions. In the case stated above our contract would allow the escrow agent to make the decision based on the terms of the contract. As follows:
Release of Earnest Money: In the event of a dispute between Buyer and Seller regarding any Earnest Money deposited with Escrow Company, Buyer and Seller authorize Escrow Company to release the Earnest Money pursuant to the terms and conditions of this Contract in its sole and absolute discretion.
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Tony and Suzanne Marri...
Scottsdale, AZ
1,848,051
Just so that everyone is clear that the contract is void. Everything has to be reduced to writing remember.
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Brenda Mayette
Glenville, NY
4,434,177
1,507,223
Procedure and it makes it nice and obvious that the seller returns the money. Some sellers can get angry and hold the money. Happened to one of my buyers, the seller released all the funds except for an amount covering a city inspection that she had to pay for (some people don't listen to reason and only want things done their way). Small amount and the agent paid the buyer back when it closed escrow with the new buyers.
Out in California, the parties can hold monies to cover inspections/expenses incurred. For example a termite company is paid for their report when escrow closes sometimes (often). If the buyer backs out, that company still needs to be paid so the buyer doesn't get all their deposit back then.
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Dr. Karen Lewis, Broke...
Fort Lauderdale, FL
4,969,061
864,708
For the funds to be released, there needs to have a mutual written consent from both parties. The seller is just going to squeeze every second before he or she returns the EMD.
5,879,946
In CO the title company will not release EM until all parties have signed.
1,729,017
Becasue the escrow is a major element in a bilateral contract, hence any change must be agreed to by the parties to the contraact
4,800,132
To have a record that all parties understand and are aware of the cancellation.
599,734
Mutual acceptance is the law. I think it's ridiculous when the terms were already agreed to, but that's what the law requires.
3,071,589
1,625,746
I just had a seller who had to accept another offer and open another escrow ''subject to a cancellation'' without a buyer#1 signature, since B#1 and his agent just do not answer or show any signs of existence.
4,319,873
Karen Jones Lewis, MBA, Realtor - I never understood this!
And I have come across some sellers who are holding the deposit!
3,988,013
259,105
I've run into this and it's generally a title company policy, not law. But each state is different. Check with your local board. or state RE department.
3,986,308
In Minnesota we have the cancellation also. Part of it is legal release of E-Money
1,157,791
Laws and regulations vary from jurisdiction to jurisdiction. Legal counsel for the relevant jurisdiction should be able to advise on this matter.
3,350,914
Because the seller is a party to the transaction and all parties must agree and consent.
5,773,392
3,416,088
It takes 2 signatures to enter into a contract and 2 signatures to get out of said contract
4,183,046
Karen Jones Lewis, MBA, Realtor It is according to the term of the agreement.
3,590,991
Because it's contract law. It's a simple requirement that must be given to title company to release earnest deposit and close out the file. Plus I imaine a broker would require it for their files. I do.
5,247,618
Earnest money is held for the benefit of the parties, so each needs to approve distribution!
902,658
You should ask your attorney regarding your local laws, or maybe that's what's in the contract?
5,259,152
Oh, I have that VERY same annoyance, Karen! I can understand having or needing to sign a termination agreement but, not release of monies when it clearly states in the Contract that they are to be released. It only causes problems with difficult clients who refuse to sign the releases.
1,242,204
I have one that I managed to get back two months after cancellation. The seller wanted to drag the buyer into a deal that she did not want to have.
It took through an arbitration initiated by a Standford law school faculty and filing complaints to BRE and RE Board. The last two orgs did nothing.
6,426,360
Takes a little bit of the liability off of the broker if all agree to how the em is handled.
1,617,916