Key Takeaways
- Most earnest money disputes are caused by ambiguous contract language — prevention through clear drafting is essential.
- Escrow agents must hold disputed funds until receiving mutual instructions or a court order.
- Interpleader actions allow escrow agents to deposit funds with the court when disputes cannot be resolved.
- Proactive engagement when transactions are failing can prevent positions from hardening into formal disputes.
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Test Your Knowledge
1.What is the most common trigger for earnest money disputes?
2.What is an interpleader action?
3.What contract provision best prevents earnest money disputes?