Sandy0716
Apr 3, 2009, 01:41 PM
Can anyone provide an interpretation regarding this HUD Policy? I am trying to get my 'earnest money' back from escrow because the bank/builder have not finished my building within the timeframe required in the contract. Escrow will not release because the bank won't sign to release the money to me. They have had my 'earnest money' for four years. Thank you in advance for your reply! Sandy.
U.S. Department of Housing and Urban Development
Office of Housing
Special Attention of: Notice H 92-10 (HUD)
Regional Administrators Issued: January 28, 1992
All Regional Directors of Expires: January 31, 1992
Housing
All Field Office Managers Cross References: Handbook
4310.5 REV-1 All Chief Property Officers
Subject: Failure to Abide by HUD's Earnest Money Policy
To participate in HUD's sales program, real estate brokers must sign
The Agreement to Abide in which they certify that they will comply with
HUD's instructions on the disposition of earnest money deposits. The
Purpose of this Notice is to provide guidance to Field Offices for
Implementing action(s) when the selling broker fails to comply with HUD's
Instructions on a sale which fails to close. Therefore, Field Offices are
Expected to implement the following procedures upon cancellation of a sale.
1. If the broker on a sale which fails to close is holding the earnest money deposit, in either an escrow or client's trust account, written instructions must be provided to that broker as to the disposition of such funds. If the broker fails to comply with those written instructions, within 15 calendar days of the date of the initial notification, forward a second notice to the broker, demanding the prompt disposition of the earnest money deposit and advising that
Failure to comply within 10 calendar days of the date of the second
Notice may result in a Limited Denial of Participation (LDP) action
For a period of one year.
2. If the broker has not complied within 10 calendar days of the date of the second notice.
a. Notify the State Real Estate Commission (or proper regulatory
Body) as to the broker's failure to comply with his/her
Certification, and
b. Follow the procedure set forth in 24 CFR, Part 24, for issuing a
LDP against the broker, and
c. Ensure that offers to purchase are not accepted from that broker.
The above procedures will be incorporated in an upcoming change to
Chapter 6 of Handbook 4310.5. If you have any questions, please direct
Them to Headquarters Single Family Property Disposition Division at FTS
458-1832.
U.S. Department of Housing and Urban Development
Office of Housing
Special Attention of: Notice H 92-10 (HUD)
Regional Administrators Issued: January 28, 1992
All Regional Directors of Expires: January 31, 1992
Housing
All Field Office Managers Cross References: Handbook
4310.5 REV-1 All Chief Property Officers
Subject: Failure to Abide by HUD's Earnest Money Policy
To participate in HUD's sales program, real estate brokers must sign
The Agreement to Abide in which they certify that they will comply with
HUD's instructions on the disposition of earnest money deposits. The
Purpose of this Notice is to provide guidance to Field Offices for
Implementing action(s) when the selling broker fails to comply with HUD's
Instructions on a sale which fails to close. Therefore, Field Offices are
Expected to implement the following procedures upon cancellation of a sale.
1. If the broker on a sale which fails to close is holding the earnest money deposit, in either an escrow or client's trust account, written instructions must be provided to that broker as to the disposition of such funds. If the broker fails to comply with those written instructions, within 15 calendar days of the date of the initial notification, forward a second notice to the broker, demanding the prompt disposition of the earnest money deposit and advising that
Failure to comply within 10 calendar days of the date of the second
Notice may result in a Limited Denial of Participation (LDP) action
For a period of one year.
2. If the broker has not complied within 10 calendar days of the date of the second notice.
a. Notify the State Real Estate Commission (or proper regulatory
Body) as to the broker's failure to comply with his/her
Certification, and
b. Follow the procedure set forth in 24 CFR, Part 24, for issuing a
LDP against the broker, and
c. Ensure that offers to purchase are not accepted from that broker.
The above procedures will be incorporated in an upcoming change to
Chapter 6 of Handbook 4310.5. If you have any questions, please direct
Them to Headquarters Single Family Property Disposition Division at FTS
458-1832.