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Ok, the buyer is not closing on your house.  Do you get to keep the earnest money?  It boils down to why the buyer is not closing on your home.   The buyer has two outs or has two contingencies to get out of the purchase contract. 

They are the inspection contingency and the mortgage contingency.  If for any, and I repeat any reason the buyer does not like the inspection results they can back out of the contract and get their full earnest money back.  They could say they do not like the crack in the sidewalk, or the loose door knob and they can get their earnest money back.  They honestly do not have to even give you a reason why.  All they have to say is that they do not like the results and they can void the contract.  It is sometimes used by buyers who are getting cold feet.  It is best they back out right away so your home is not off the market for very long.

The second contingency that the buyer can bail out of the purchase contract is the mortgage contingency. If the mortgage lender denies the loan then the buyer gets their money back.  If the appraisal does not come in at value and they have the right percentages on the purchase agreement they can back out of the purchase agreement and get their full earnest money back.  That is why most sellers have to lower their price if the house does not appraise.  Usually at this point in the process it is a real reason.  Most buyers are committed to buying the home and they are not using the mortgage contingency to get out of the deal.

If the buyer just gets flakey and decides they are not moving forward, or not closing the deal you have the right to keep the earnest money.  However this is where it gets tricky.  The buyer must agree and sign the mutual release in order for you to get the money back.  In sixteen years in the business I have only seen a few sellers get the money back when the buyer flakes out.

If the money is not released it will stay in the brokerage account for 5 years and then be given back to the buyer unless you sue them.  So you are not going to get the money unless the buyer voluntarily signs the mutual release or you take them to court. 

Many sellers do not want to go through the trouble of suing the buyer so they just give the money back to the buyer and get the mutual release signed.  This explains whether you get to keep the earnest money or whether the buyers get their money back