An Earnest Money check will sometimes be written by someone other than the Buyer…typically a family member. This is fine, in most instances, as long as the lender is aware of it and it’s documented properly. What happens to the Earnest Money if the contract gets canceled? If the buyer cancels the contract prior to a contract deadline and the EM is to be returned to the buyer, who is the check made out to…the buyer or the person who wrote the check?
The form contained within this article can be used to determine exactly who gets the EM should the above scenario take place. Please use the form with the letterhead specific to your Market Center.