Will I lose my earnest money here?

[James Smith]

I live in California, and I am currently experiencing something that is freaking me out. My lender is being very slow and has not ordered an appraisal yet. I am out of my contingency period and have been given the notice to perform. All contingency other than appraisal has been dropped. The seller is threatening to cancel escrow and sue me for the earnest money.

Can they actually do this? What is the next step that I should do? Any help will be greatly appreciated.

[David Avetisyan]

If you are using a standard CA sales agreement, you probably have your loan contingency in place still.

Your realtor should be working on asking for an extension to buy you time. And if your loan officer can show that the deal is solid, I don’t see why the seller wouldn’t agree. 

If you cannot perform and feel like the deal is going dead, just cancel and move on. They’ll have to refund you the deposit.

I have yet to see a seller sue because a buyer couldn’t perform given your circumstances -  especially when you still have protection under the agreement. I wouldn’t freak out.

To your success!