Contracts
In Michigan, if a buyer makes an earnest money deposit and then defaults without legal justification, the seller's typical remedy is to:
ASue for specific performance only
BRetain the earnest money as liquidated damages (if the contract provides for this)✓ Correct
CReturn the earnest money and sue for the full price
DImmediately relist the property without any remedy against the buyer
Explanation
If a Michigan purchase agreement includes a liquidated damages clause, the seller may retain the earnest money upon buyer default as the pre-agreed remedy. Without such a clause, the seller may sue for actual damages or specific performance.
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