I am selling (sub sale) my first house and got a buyer to agree to my selling fee. Agent already collected 3% earnest fee as booking. After a little over a month later, agent tells me the buyer documentation not so good,  bank cannot approve them yet. So the buyer now trying to use alternative ways like getting a guarantor or having a 2nd name on the loan. Its frustrating for me as don't the buyer check if they are financially fit to buy a house that they really want first?? But that is not for me to judge.

So lets put the worst case scenario, what if the buyer tried all tricks and still cannot get the loan approval and have to back out the buying process. Now what happens next? The 3% earnest fee that they paid burn? The 3% earnest fee will give back some to the buyer and remaining will cover the lost of time between the agent and the seller? Or all 3% will give back to buyer?

First house im trying to sell and this happens, so want to know what is to be expected if things don't go according to plan (which I HOPE it don't reach this point la....).