{"id":7782,"date":"2022-07-22T17:46:00","date_gmt":"2022-07-22T17:46:00","guid":{"rendered":"https:\/\/wahi.com\/ca\/en\/?p=7782"},"modified":"2025-12-19T10:41:29","modified_gmt":"2025-12-19T15:41:29","slug":"4-penalties-for-not-closing-on-time","status":"publish","type":"post","link":"https:\/\/wahi.com\/ca\/en\/learning-centre\/real-estate-101\/buy\/not-closing-on-time","title":{"rendered":"4 Penalties for Not Closing on Time"},"content":{"rendered":"

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A closer look at the penalties a buyer may incur if they fail to close on time on the purchase of a home in Ontario<\/a>. <\/span><\/p>\n<\/div>\n

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By Emily Southey<\/a> | 7 minute read<\/p>\n

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Missing a closing date is serious business. When a buyer fails to close escrow on time, it can have major ramifications. At a minimum, the purchase contract, which stipulates a closing date, is put in jeopardy. In a worst-case scenario, the contract could expire, requiring the buyer to request an extension from the seller, which they may not agree to. Four penalties for a buyer not closing on time.<\/span><\/p>\n

–<\/span><\/p>\n

The penalties for a buyer not closing on time vary but may include the following:<\/span><\/p>\n

–<\/span><\/span><\/p>\n

1. The seller might keep your earnest money deposit<\/strong><\/h3>\n

When you <\/span>buy a house in Ontario<\/span><\/a>, you must put down a deposit. This is what\u2019s known as an earnest money deposit or good faith money. It shows the seller you have the necessary funds to purchase their home. Traditionally, earnest money deposits are returned to the buyer on the closing date. From there, the buyer can put their deposit toward a down payment or other out-of-pocket expenses, such as closing costs. However, if you fail to close on time, the seller has the right to keep your deposit, meaning you won\u2019t receive this money back. Earnest money deposits are usually around 5% of the purchase price of the home, which means you would be out $25,000 on the purchase of a $500,000 home. <\/span><\/p>\n