Advice on Earnest money deposit in Washington – Page 1 - Avvo

The Washington Legislature has passed and the Governor has signed a new law concerning the disposition of earnest money EM in a failed transaction. This law will go into effect on July 24, , and will apply to EM deposits still held in escrow on that date as well as deposits made after the effective date.

Be aware that the law only applies to earnest money and not other funds that may be held in escrow and that the law only applies to residential property — improved or vacant. If escrow receives a written demand from a party to a transaction for all or a portion of the EM, it has three options under the new law —.

If a written objection or inconsistent demand from one or more of the parties is received at the specified address within the 20 day period described above, escrow —. Escrow may commence an interpleader action at any time prior to the expiration of the 20 day period described above.

If a written objection or inconsistent instruction is received prior to the expiration of the 20 day period, escrow is required to commence an interpleader suit as noted above.

An interpleader is a lawsuit to determine the ownership of property the EM held by a disinterested third party escrow. Normally the suit is filed by the plaintiff escrow in state court District or Superior Court naming those that may have an interest in the EM as defendants the buyers and sellers.

It should be noted that small claims courts will not accept interpleader suits.

The new statutes have added some rules that are specific to those interpleader suits that concern the ownership of earnest money deposits. Robert has helped my wife and I a few times over the years.

He has a way of making complex situations, simple. He gives you options and comes up with a bottom line quickly, not wasting your time or his. Our latest was dealing with him was an estate and probate.

What is the right amount of earnest money?

We consulted him a few times on sensitive issues and he handled the sale of the property. I highly recommend him. I've worked with Robert for a couple of years and he is by far the best attorney I've dealt with.

He is honest, quick, and efficient. I've never felt like my money was wasted. Rob Rowley agreed to meet with me because I am the new owner of an investment property and a friend recommended him. Our meeting was brief and to the point, but I didn't feel rushed at all.

Instead, Rob listened intently to my questions and concerns and gave me useful answers, as well as time to take notes. I am grateful to my friend for recommending Rob Rowley to me because a real estate attorney is a valuable contact to anyone who plans to invest in property, and Rob is a good one. I feel comfortable recommending him to anyone who needs guidance in real estate law.

Rowley PS Attorney at Law.

Contact Us Now Home About Us Biography Of Robert R. An LLC or S-Corporation? New Washington Residential Earnest Money Statute effective July 24, Options are limited by the new law.

RCW Handling of earnest money—Definitions—Notice from holder—Interpleader action, forms—Application.

If escrow receives a written demand from a party to a transaction for all or a portion of the EM, it has three options under the new law — Release the EM as demanded which may subject escrow to liability ; or Commence an interpleader court action; or Send a notification of the demand as described below to all of the other buyers and sellers. Notification of Receipt of Demand for Earnest Money. Notice of the demand must be sent to all other buyers and sellers within 15 calendar days of receiving the written demand.

Click below for a sample Notice of Demand which you may use or revise. The notice must be sent by U. Mail to the last known mailing address and by email to the last known email address. The notice must include a copy of the written demand. The notice must advise the parties that they have 20 calendar days from the date the notice was placed in the mail and the email transmitted to provide a written objection to the release of the EM or the money will be released to the demanding party.

If objection is received within 20 days. If a written objection or inconsistent demand from one or more of the parties is received at the specified address within the 20 day period described above, escrow — must not release the funds to any party; and must commence an interpleader action within 60 calendar days of the receipt of the objection or inconsistent instructions; unless the parties provide subsequent consistent instructions to a disburse the EM or b refrain from commencing an interpleader action for a specified period of time.

If objection is not received within 20 days.

New rules for filing interpleader actions. There is provided in the new statues acceptable Summons and Complaint forms see pages of the copy of the new. Facebook Google Twitter LinkedIn Email Print.

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