If you’re planning to buy a home, you may be asked to put down earnest money to show that you’re really serious about the purchase.

If you don’t follow through with the home purchase, you usually lose the earnest money, but in today’s story, one couple found a way to back out of a home purchase without losing the earnest money.

Find out what they did.

Check it out.

We won’t get our earnest back? Fine, we won’t be able to satisfy requirements for closing.

My wife and I decided to finally purchase a home in Southern California – a brand new, decked out 4 bedroom home that really felt like something we didn’t deserve.

We gave in an earnest deposit of $10k towards an escrow account which would then go into the closing costs.

The closing period we requested was Mid September.

This sounds like a potentially big problem.

Meanwhile, my wife’s employer informed her that her team may go through some corporate restructuring and she may be axed.

Nothing big, it happens in her industry at times, with all likelihood that she would simply transfer to another team.

However, what makes our situation tricky is that we are on a work visa.

Which means finding another job and filing legal paperwork can be very dicey.

They wanted to back out of the home purchase.

With this development, and our general desire to seek out better opportunities abroad, we were getting nervous about this commitment.

We informed the builder and their lender that we are contemplating cancelling the loan because of this situation and we would like our earnest deposit.

We never assumed it will be easy, but were hopeful someone would hear us out.

We immediately got told by the sales agent that since our deposit has been in escrow for more than 30 days, and since we have a conditional loan approval, we won’t get our deposit back.

It sounded suspicious.

The lender was very understanding but for some reason was anxious to have us cancel the loan and said that he would be happy to work with me on future loans.

I was a bit suspect since he was the builder’s lender, he would always back the builder.

I told him to hold off, since I didn’t want to cancel before I fight to get my deposit back.

Perhaps they found a loophole.

We requested the sales agent to reconsider and talk to her superiors, even offering to mediate a call between my wife’s manager and them to understand the impact.

The seller was under the opinion that unless she gets a pink slip, we don’t qualify to get our money back.

We started panicking but looked through the purchase agreement where we found a clause that if we failed to get financing, the buyer (us) is eligible for a refund.

It really wasn’t in their best interest to cancel the agreement early.

When a few back and forth emails didn’t help, the seller agent simply asked if we would like to sign the cancellation agreement.

The date was July 31st. Closing was a bit more than 45 days away.

I realized, that while we would fight tooth and nail, our worst case scenario is we lose $10k.

Whether it is on July 31st or we lose during Closing, it is the same to us.

However, if we keep the agreement ON without cancelling, only for us to fail at closing, the seller can’t find another buyer despite knowing that we won’t be closing.

He was honest.

I emailed her saying that we are confident that we won’t meet financing which is requirement for maintenance of escrow during closing, but we desire to continue with the closing date of Mid September and not cancel.

This means, worst case we lose $10k in September.

Worst case for the seller? They can’t find another buyer till then.

This is great news!

We immediately (within 10 minutes) got told that we are getting our deposit back!

We were ecstatic!

We felt sorry that we weren’t able to close on our home, but we didn’t want to be in a bad loan and put everyone else under stress.

Being honest really paid off in this case! It’s too bad they didn’t get what sounded like their dream house, but sometimes circumstances change.

Let’s see how Reddit reacted to this story…

This reader likes how the story played out.

As someone who lives in California, this is true.

This is a good point.

Buying a home can be stressful.

Sometimes honesty really is the best policy!

Buying a home is not for the faint of heart.

If you liked that post, check out this post about a woman who tracked down a contractor who tried to vanish without a trace.