Seller wont sign termination/Closing attorney will not release earnest money

[Galen Dawes]

Hi,

I entered a binding agreement with the Seller to purchase an unlisted property in Atlanta, cash. The closing attorney is holding my $2500 in earnest money. In our contract it states: Seller agrees to furnish a marketable title to the said property and agrees to convey by Limited Warranty deed to Purchaser at closing, subject only to the following:
a. All valid restrictions of record; and
b. Zoning ordinances affecting same
Purchasher shall have reasonable time after acceptance of this Contract in which to examine title and in which to furnish Seller a written statement of objections affecting the marketability of said title. Seller shall have a reasonable time after reseipt of such objections and if the Seller fails to satisfy such valid objections within a reasonable time, then at the option of the Purchaser, evidence by written notice to Seller, this contract shall be null and void.

5 business days after the date of the binding agreement the closing attorney informed me that the title was not clear. There was an open security deed for $176k and a couple of other smaller liens to someone that may be a business partner of the Seller. At this point the Seller was furious with the closing attorney telling them and me via email that the house was purchased at a tax deed sale and the title was clear. He requested the title work from the closing attorney in which he was denied but the closing attorney was willing to make him a summary of what the title showed. This sent the seller into a rant about how he had never been denied the title work. I tried to call and email the seller to let him know if he wanted to use another closing attorney that could provided me with an enhanced title insurance policy I would be willing to use another closing attorney since he felt very strongly that the title was clear.

I wanted the house so bad I failed to terminate the contract or extend it before the said closing date had passed. My closing attorney informed me they might have been able to get a release on the open security deed and that the closing attorney had spoken to one of the sellers partners and he agreed to pay the liens with the exception of the open security deed.

Once the said closing date passed the seller stop communicating with me. I attempted to call to expressed that I wanted to purchase the house and would be willing to wait a few weeks if he could provide a clear title. Seller did not respond

The seller is not willing to sign termination letter since closing date has already passed. He is requesting the earnest money be sent to him due to my default. The closing attorney can not release the funds unless both parties sign the termination and release letter which the seller is not going to do. The closing attorney is saying it would be best to work it out because if he has to turn it over to the court it can be a big hassle for everyone. How do I take the Seller to court over this matter? I'm not sure what to do next but I want my money back even if it takes a year or two.