Earnest deposit
CreateGoodwill
(Querist) 23 March 2012
This query is : Resolved
I am purchasing a property in whcih the sellers ask for earnest money.
what is mean by earnest money what are the terms and condtiion for the same.
if the deal does fails what will happen to my earnest money paid pl suggest.
V R SHROFF
(Expert) 23 March 2012
It is token , not returnable, if deal fails for any reason due to the purchaser.
It is limited to short duration, after which, deal is treated cancelled and forfeiture of Token./ Earnest money.
By accepting it, seller binds himself, not to sell to anybody else, even if he get better price, for that limited period.
ajay sethi
(Expert) 23 March 2012
earnest money is down payment or token that is paid at time of negotiating deal for purchase of property .
dont pay substantail sum as token . insist that in case deal is cancelled token will be returned and not forfeited . also specify the period within full payment will be made and posession handed over to buyer by the seller
Adv.R.P.Chugh
(Expert) 23 March 2012
Earnest Money is an expression of interest in going ahead with the transaction. In case of default on agreement from your side - a reasonable amount from earnest can be forfeited (even though agreement may provide for forfeiture of entire amount) In case the other party is at fault and fails to oblige and perform his obligations you can ask for specific performance + damages + return of earnest with interest.
Guest
(Expert) 29 March 2012
Earnest money is type of caution or token money to be kept with the seller and liable to be forfieted, as a compensation to the seller, if the buyer backs out of the deal. The same is however treated as a part of the total deal amount and adjustable while making final payment on honour of deal by the concerned parties.
