Real Estate Closing Attorney San Antonio: When a Deal Falls Apart

A real estate closing attorney San Antonio buyers or sellers call after a deal collapses usually starts with the same document: the contract. Nearly every residential resale in Bexar County runs on the Texas Real Estate Commission’s One to Four Family Residential Contract. The current version is Form 20-19, effective July 1, 2026. That form already decides most closing disputes before anyone files anything. It sets the deadlines, names the remedies, dictates who gets the earnest money, requires mediation, and awards attorney’s fees to whoever wins.

What the form cannot do is make a lender fund a loan, clear a title defect, or force a party to show up at the title company. This guide follows the contract’s own paragraphs through the four ways a San Antonio closing most often falls apart. It then covers what each side can do about it.

The Deadlines That Come Before a Real Estate Closing Attorney in San Antonio Is Needed

The contract’s calendar starts on the effective date. Under Paragraph 5, the buyer has three days to deliver the earnest money and the option fee to the escrow agent. Paragraph 5.B gives the buyer an unrestricted right to terminate during the option period, for any reason or none. The earnest money comes back, and the seller keeps the option fee. Next, Paragraph 6.B requires the title company to deliver a title commitment within 20 days of receiving the contract. The buyer then has a negotiated number of days under Paragraph 6.D to object to anything in it, and the seller has 15 days to cure.

The closing date in Paragraph 9 is the stated date or seven days after title objections are cured, whichever is later. Under Paragraph 5.E, time is of the essence. In this contract, a missed day is a breach, not a delay.

Failure One: The Financing Falls Through

Most San Antonio buyers attach the Third Party Financing Addendum, Form 40-11. It contains two separate escape hatches. Paragraph 2.A covers buyer approval. The buyer may terminate within a negotiated number of days after the effective date by delivering notice plus the lender’s written statement of the reasons. The earnest money comes back. After that window closes, the contract is no longer contingent on the buyer qualifying. Paragraph 2.B covers property approval. If the lender decides the property fails its underwriting requirements, whether for appraisal, insurability, or required repairs, the buyer may terminate. The deadline is the third day before closing.

A low appraisal on its own is not a contract defense unless the parties used the appraisal addendum, Form 49-1. That addendum lets a buyer waive, partially waive, or add a right to terminate when the appraisal misses a stated figure.

Failure Two: The Title Commitment a Real Estate Closing Attorney in San Antonio Reads First

The title commitment lists every recorded lien, easement, and exception the title company found. An unreleased lien from a prior owner, an heirship gap, or a judgment against the seller all show up there. Under Paragraph 6.D, the buyer must object in writing by the earlier of the closing date or the negotiated objection deadline. The seller then has 15 days to cure. If the cure fails, the buyer has five days to terminate and recover the earnest money, or to waive and close anyway. A seller who cannot deliver clear title by the closing date is in default under Paragraph 9.

The Texas Title Insurance Act governs title insurance, and the Department of Insurance sets the premium under Insurance Code Section 2703.151. A title company cannot discount the policy to save a deal. What it can do is hold the closing until the defect is cured, which is often the only practical fix.

Failure Three: One Side Does Not Show Up

Paragraph 15 sets the remedies. If the buyer defaults, the seller may enforce specific performance, seek other relief the law provides, or both. Alternatively, the seller may terminate and keep the earnest money as liquidated damages. If the seller defaults, the buyer gets the mirror image: specific performance, other relief, or termination with the earnest money returned. Specific performance is a real remedy in Texas real estate, because courts treat land as unique. In DiGiuseppe v. Lawler, decided in 2008, the Texas Supreme Court held that a party seeking it must plead and prove they were ready, willing, and able to perform. A buyer whose loan never got approved cannot force the sale.

Civil Practice and Remedies Code Section 16.004(a)(1) gives four years to sue for specific performance of a real estate contract. Business and Commerce Code Section 26.01(b)(4) requires the contract to be in writing and signed. A verbal extension of the closing date is therefore unenforceable.

Failure Four: The Earnest Money Fight After a Real Estate Closing Attorney in San Antonio Gets Involved

Paragraph 18 governs the escrow agent, which in Bexar County is almost always the title company. The agent cannot release the earnest money without a signed release from both parties or a court order. Paragraph 18.C provides the mechanism. Either party may send a written demand to the escrow agent, which copies the other side. If no written objection arrives within 15 days, the agent may disburse to the party who demanded. Paragraph 18.D adds the penalty. A party who wrongfully refuses to sign a release within seven days of a request is liable for damages, the earnest money, reasonable attorney’s fees, and all costs of suit.

Insurance Code Section 2652.004 adds one more rule that surprises sellers. An escrow officer may not disburse until good funds have been received and deposited, so a wire that has not cleared does not close a sale.

Mediation, Fees, and the Lis Pendens

Two paragraphs shape the litigation before it starts. Paragraph 16 requires the parties to submit any dispute not resolved informally to a mutually acceptable mediation service, with the cost shared equally. Then Paragraph 17 awards reasonable attorney’s fees and costs to the prevailing buyer, seller, broker, or escrow agent in any proceeding related to the contract. That fee-shifting clause changes the math on every earnest money dispute.

A buyer who sues for specific performance may also record a notice of lis pendens under Property Code Section 12.007. It warns anyone searching the Bexar County records that the property is in litigation. In practice, that stops the seller from closing with someone else. Section 12.0071 lets the seller move to expunge it on 20 days’ notice. Expunction follows if the claim is not a real property claim or the buyer cannot show its probable validity. Arizona handles the same disputes differently, as our guide to breach of a real estate contract in Arizona explains.

The Bottom Line

The TREC contract decides most San Antonio closing disputes on its own terms. A financing failure inside the addendum’s window returns the earnest money. Outside it, the money stays at risk. A title defect the seller cannot cure lets the buyer walk. Refusing to close invites specific performance, and refusing to sign a release adds fees on top of the deposit. What the contract does not resolve is who was actually ready, willing, and able on the closing date. That is where every dispute ends up. Mediation is mandatory, fees shift to the winner, and four years is a long time to hold a lis pendens on a house nobody can sell. Most parties settle for the earnest money for exactly those reasons. That is why a real estate closing attorney San Antonio clients hire often spends more time at mediation than in court.

Keep reading: Breach of Real Estate Contract Arizona: Earnest Money and Specific Performance · Title Insurance Arizona: What a Policy Actually Covers After Closing

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This article is for general informational purposes only and does not constitute legal advice. Contract remedies depend on the specific form, addenda, and dates the parties used, and TREC revises its promulgated forms periodically. Anyone in a closing dispute should consult a licensed Texas real estate attorney.

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