Does anyone know the process of backing out of buying a house from a builder? Is it common for the earnest money to be refunded or do builders typically retain this money?
Hi Sayde, Since you haven't received a response I'll give what I would do.If you haven't signed a contract you can back out and have all money returned to you. Even if you have signed a contract and as long as no work has begun the builder should return your money.
Earnest money is just that.........You agreed to have him build your house and paid him in "earnest".......you changed your mind .......the money is his........doug
Still have to disagree with Dougs reply. If you have'nt signed anything that money is yours. If you did sign and he has'nt applied for permits he should give the money back.I have backed out of deals more then once and have always got my money back.Earnst money is just that If you and the builder agreed to build a house and he begins the process of spending money'your money, yes kiss the money good-bye.If he has'nt done anything yet the money is yours.
if there is a purchase agreement on the house and it has been signed, bottom lined and agreed upon and earnest money was paid then it is the builders to keep, unless he wants to be a really really nice guy but that isnt too likely. here is a good point to consider however, if the builder has changed anything about the house without your consent or which was not originally agreed upon he either has to correct it or you can back out safely of the agreement, my advice though is to get a lawyer and talk it out with him since i dont know all of the important details and hey I'm a realtor not a lawyer so they would know all the finer points but I hope I pointed you in the right direction and good luck