The 'Seller Says No Problem' Text and the Missing Earnest Money

Do not rely on it. It is weak on at least three grounds.

• Statute of frauds. A contract for the sale of land, and any modification of it, must be in writing and signed by the party to be charged. A text message can be an electronic record and an electronic signature can satisfy the statute - but it must be attributable to the party being charged.
• Authority. The listing agent is a special agent with limited authority. He has no implied power to extend deadlines, waive contingencies, or alter the price. Unless the seller gave express written authority, the seller is not bound by the agent's reassurance.
• Form requirements. The GAR form contemplates amendments signed by both parties. 'We're fine, take your time' identifies no deadline, no new date, and no contingency, so it is nearly impossible to enforce as a specific modification.

Practical translation for the client: get a written amendment signed by both buyers and sellers setting a new due diligence and closing date, before the original deadline passes. A helpful text from the other side's agent is not a substitute.

The broker is a stakeholder and cannot decide the dispute.

• Earnest money is trust money held for the transaction, not for either party. Once the parties make competing claims, the broker must not disburse unilaterally - paying either side exposes the broker to liability and to a Commission trust-fund complaint.
• Proper handling: notify both parties in writing of the competing demands, request a written release signed by both, and if no release is produced, interplead the funds (deposit them with the court) and let a judge decide.
• There is a second problem in the facts: the earnest money was still undelivered on Thursday. Under the agreement and Commission rules the broker must deposit trust funds promptly into a designated trust account and may not commingle them. A buyer who never delivered the deposit may itself be in breach - which cuts against the seller's claim that the buyer is the only one at fault.
• On the merits, the seller's position is not automatic: if the seller's agent's statement reasonably induced the buyer to let the deadline pass, the buyer can argue waiver or estoppel. That is a legal argument for counsel, not a determination the broker makes.

Advise:

• Preserve the entire text thread, the showing and approval timeline, and the lender's written status updates. Evidence of the seller's conduct is the buyer's leverage.
• Offer a written amendment that ratifies the extension and sets a firm closing date. If the seller signs, the dispute largely evaporates; if the seller refuses, that refusal is itself evidence.
• Explain the two conceptual tracks: the seller may be arguing the buyer failed a condition (financing deadline), while the buyer may be arguing the seller breached by repudiating a deal both sides treated as alive. The remedies differ - return of the deposit, damages, or specific performance if the contract supports it.
• Refer to a real estate attorney for specific performance and for any negotiation over the deposit.

Avoid:

• Do not advise the buyer to sign a release of the earnest money, or a termination, to 'make it go away.'
• Do not opine on who legally wins - that is unauthorized practice of law.
• Do not let the buyer simply fail to show up Tuesday; formally tender performance in writing so the record shows the buyer was ready, willing, and able.