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Updated almost 8 years ago,
Seller wants to keep Earnest Money upon Assignment
Hello all,
I had a seller renegotiate these terms in our contract.
"In the event of an notification of assignment of this contract, the Earnest Money becomes non-refundable and will be immediately released to the seller without future obligation. Notification of assignment will be made in writing to the Seller and the Sellers attorney."
I don't think that this clause is necessarily a deal-breaker (and I could be totally wrong), but I'm taking on a hefty amount of risk in the case where I assign the contract to another investor without my own non-refundable earnest money deposit.
Since I've never seen a seller negotiate this, I'm looking for advice on how to market this deal to other investors. Would I just market this property for my desired cost minus the earnest money? Are there any legal gotchas that I'm not seeing here?