I plan on doing a final walk through right before closing happens. Let’s say I found 3 empty lots that are supposed to be occupied, or some serious damages done to the park during the walk through right before closing. Do I call off the closing and demand my EM back? That’s way past my due diligence so not sure if you would be able to get your earnest money back?
Typically you call the Seller and ask why you were not made aware of material changes, and then explain how those changes affect the value of the business. Choice is to reduce the purchase price to reflect those changes or you back out.
Whether you get your EM back will depend on the language in your purchase agreement.
If you are able to get agreement on a reduce purchase price you can do that on the fly at closing with the Title Company.
I agree with jhutson. Hopefully your contract has language that would allow you to get your EM back based on the actuals not aligning with the data you were given by the seller that you used to calculate your offer price. I put language in my contract that states that my offer is based on the data that I’m given by the seller or broker. And have an ‘out’ in case actuals don’t align with what’s given. This may or may not help me get my EM back however I have a strong argument to get it.
Deal closed! Thanks guys!