earnest money refund question

A prospective buyer gave us a very low earnest money (P20,000) as deposit on our house and lot with agreed selling price of P2.375M. We issued a contract to sell (loan documentary req't) and an acknowledgement receipt of the earnest money.

They immediately requested us to take the property of the market while they process their pag-ibig loan application which they guaranteed as approved. In good faith, we complied with their request.

After a month, it appears that they have some loan funding problems with pag-ibig and with banks they approached, as they have no money to add as their loan equity.

A> if the buyer backs out from the transaction bec of their own funding problem, is the seller obligated to return the earnest money? Considering that the acknowledgement receipt did not mention of any forfeiture clause?

B> the forfeiture clause was omitted from the acknowledgement note since the seller was guaranteed by the buyer that their loan facility is good as approved

Your legal comments needed. Thanks.

what does your CTS say about when they should pay? send a demand letter giving them a reasonable time to comply after which you can state that you are rescinding the agreement.

it'll be up to you if you want the headache regarding the P20k. it'll depend on what is written on your contract about it. if none, then you have to give it back, unless you want to claim it as damages.

Thanks for the feedback.

The CT does not include a provision on the refund.

I will just claim the P20k for lost opportunity damages. Ty.