If we were to purchase an FSBO house and gave $500 earnest money, how can we get it back based on an unsatisfactory home inspection?

UPDATED: Sep 30, 2022

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If we were to purchase an FSBO house and gave $500 earnest money, how can we get it back based on an unsatisfactory home inspection?

Purchase was contingent on the house passing a home inspection. We found too many things we didn’t want to have to fix so backed out. The seller cashed our earnest money check. Should he return the money?

Asked on November 25, 2015 under Real Estate Law, Arkansas


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

If, as you write, there was an inspection contingency in the home sale contract allowing you to terminate the sale and get your earnest money back in the event the inspection found problems, then no--the seller should not have cashed your check and he should return the money. If he will not, you could sue him, such as in small claims court, acting as your own attorney ("pro se") for the money. A copy of the contract and the inspection report would be necessary for the trial.

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