Is the contract void if a buyer fails to close on or before the Settlement Date?
QUESTION: Today is the Settlement Date for one of my listings. We amended the original Settlement Date and changed it to today using the Agreement to Amend Contract (Form 4-T). The buyers claim that they only need five more days to close, but my sellers are very frustrated and want to move on. I am preparing to go back active in the MLS tomorrow after the contract on Form 2-T expires and becomes void. Can you tell me what form I need to fill out so my sellers can claim the Earnest Money Deposit (“EMD”)?
ANSWER: You should wait to be back active in the MLS, because the Offer to Purchase and Contract (Form 2-T) will not “expire” and become void tomorrow. If this transaction does not close within the applicable delay period because of the buyers’ delay, then the sellers may terminate and inform the escrow agent that they wish to receive the EMD.
As a starting point, Form 2-T does not expire and become void when the Settlement Dates pass. In fact, Form 2-T does not become void even if the applicable delay period passes. Instead, Form 2-T continues to be effective until it is terminated by either the buyer or the seller.
Since you used Form 4-T to extend the Settlement Date, you need to examine whether the delay period was shortened to four days instead of seven. In Form 4-T, there is a checkbox that allows the buyer and seller to shorten the delay period to four days. If that checkbox is not marked in your Form 4-T to extend the Settlement Date, then that means the seven-day delay period in Form 2-T still applies.
Assuming the checkbox in Form 4-T is not marked here, then the buyers have seven extra days to close, and your sellers do not have a right to terminate yet (if the buyers are acting in good faith).
If the buyers in this case do not close within the delay period, then your sellers may terminate using Form 352-T. If your sellers terminate the contract, and your sellers want to claim the EMD, then you should indicate at the bottom of Form 352-T that your sellers “do not” agree to release the EMD. You should also email the escrow agent and tell them your sellers are claiming the EMD.
The escrow agent will then evaluate whether there is a dispute concerning the EMD, and if there is no dispute, then the escrow agent may pay the EMD to your sellers. Just be aware that escrow agents may have their own criteria for releasing the EMD, and depending on those criteria, your client may have to file a lawsuit or file a claim with the clerk of court to be paid.
Release Date: 12/18/2025
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