Dear George: I submitted an offer on a property with $1,000 in earnest money. When additional time was needed to get my loan approved, I paid an additional $1,000 for an extension to the closing date. But my extension expired before I was able to get my loan approved. The seller doesn’t want to sign the new amendment so I can close on the property, nor does he want to sign the termination paperwork to release my funds. He wants me to give him $1,000. Is this legal?

Answer: Yes. Normally, if a buyer doesn’t obtain loan approval within the length of time contained in the Third Party Financing Addendum or any extension thereof, the earnest money is forfeited. You didn’t perform and, therefore, lost half your earnest money. Next time, get your financing in order before you sign a contract. Losing $1,000 is a pretty cheap lesson in contract law.

E-mail a question to ask George & Chuck or fax it to 713-978-6684. The answers to questions in this column do not contain legal advice. If you wish to obtain legal advice, you should consult your own attorney.