It will depend on how the contract is written, If you have a REALTOR, which is always the best way to approach buying a home, he or she should be protecting your best interests. That’s their job. I would guess they have written the contract so if you can not get loan approval you will get your earnest money back. In TX it is in paragragh 3. You should have received a copy of the contract. You will be out the option fee you paid and any insepction fees you paid during the option period however. Those are never returned as these are both options FOR the buyer,

almost all contracts have final underwriting as a condition of sale and if that has not happened then yes you get your ernest money refunded

Since you are getting an FHA loan, your contract has some type of financing contingency. It will probably have a number of days (sometimes the same as the option period, sometimes different) by which you want to know if you’ll get approved. If your denial comes before the end of those days, you get your EM. If it comes after those days - and this should not happen since your loan officer and Realtor know to keep track of the days - you lose the EM. No other penalty.

you should ask to push your option period out further

Lose just your earnest money.