Lost Earnest Money Due to Agent Error

[Account Closed]

Hi all, 

Looking for some advice. I went under contract to purchase a home in March. I was out of state and so working with a Florida agent to assist me with the transaction. Immediately after we went under contract, my agent sent me all the important dates to know and I created calendar invites to remind myself. He stated in this email the financing contingency ended on 5/15. Two days prior I said I needed an extension to clear up a few final roadblocks. On 5/15, what I thought was the deadline based on his email, I reached back out and said if they are unwilling to extend the financing contingency, I need to get out of the deal. I emailed him that day that I needed out due to the financing contingency. He then let me know he was incorrect on the date and it was actually 5/14, and that Seller was unwilling to allow us out of the deal and they were not going to return earnest money. The only option we had at this point was to try to get the deal closed, which we were unable to due to financing. I am now out the $20,000 earnest money as it went to seller (this was a 1mm+ deal).

I know I should have double checked the dates my agent provided me but I did not. So now I am wondering if there is any recourse I can take against the agency. As of now, they have been radio silent and not answering any calls or emails. Should I get a Florida attorney involved? If so, any suggestions? This has been as expensive lesson so far, so remember to double check dates. Thanks all. 

[Dustin Allen]

@Account Closed

It’s time to get an attorney involved. Bring all the documentation that you have including the agent communication telling you when they contingency ended. You will most likely have to sue them and their Errors and Omissions Insurance will probably take of it (if they have it).

Either way, you are definitely in need of an attorney now.

[Nathan Grabau]

I would try to contact the agent's managing broker at the office they are at. It is likely that they will help you through the process. This is something that if you have it in writing, their E&O should cover, or they should be personally liable for.

Lawyering up is also another acceptable next choice, but I would personally see if you can avoid legal changes. 

[Wayne Brooks]

@Account Closed It’s probably to late now, depending on your closing date, but……under the standard farbar Fl contract, the financing contingency does Not require you to cancel/notify on that date. The contract gives the seller the right to terminate on that date, otherwise you can continue and you have up until 7 days prior to the closing date to cancel due to financing….at least the last farbar I dealt with, it may have changed. Read your Entire contract, carefully. 

[Caleb Brown]

That's a hefty EMD amount. If I caused an error and my client lost the EMD I would write them a check(I have had it do it in the past). Now 20K I doubt they would be able to reimburse you for. So I would first chat with the agent but it'll have to escalate to the broker. There is E&O insurance for situations like this. Another option is getting legal advice from an attorney. Before doing too much I would consult an attorney first, they have seen this before and can advise you. Mistakes do happen but 20K is a big one to do.

[Peter Walther]

I assume you've already contacted the broker and received an unsatisfactory response and I also assume you signed a Florida Buyer Agency Agreement.  If you review it for dispute resolution options, you might them limited to submitting the matter to binding arbitration.  You might consider submitting a complaint to the Florida Real Estate Commission.

[Account Closed]

Thanks for the replies. @Peter Walther I did find the forms and will be submitting a complaint to the Real Estate Commission as a start. Thanks.

[Edwin Epperson]

@Account Closed I know of an excellent attorney with Hand Arendall Harrison Sale based out of Destin FL.  They not only draft loan docs and closing docs they have their own in-house Title company.  Shoot me a PM and I'll give you their contact info if you still want to go that route.

[Carlos Ptriawan]

why you're not able to get the financing after submitting the EMD ?

[Peter Walther]

Quote from @Account Closed:

Thanks for the replies. @Peter Walther I did find the forms and will be submitting a complaint to the Real Estate Commission as a start. Thanks.

 You're welcome