Question

Simpson is a buyer in Minnesota. He made an offer and supplied earnest money on a property on Thursday. That offer was rejected by the seller on Friday. What happens to Simpson's earnest money?

(A) Simpson's earnest money is returned to him immediately.
(B) Simpson's earnest money is held by the seller until the closing date.
(C) Simpson's earnest money is forfeited to the seller.
(D) Simpson's earnest money is donated to a local charity.

Answer 1

When an offer is rejected by the seller, the buyer's earnest money is typically returned to the buyer immediately.

Step-by-step explanation:

When Simpson made an offer and supplied earnest money on the property, he entered into a contract with the seller. However, since the offer was rejected by the seller, the contract is considered terminated.

In this situation, the fate of Simpson's earnest money depends on the terms stated in the contract. Generally, if the offer is rejected, the earnest money is returned to the buyer.

Therefore, in this case, Simpson's earnest money would be returned to him immediately.