Is this money required when an agent shows you a property that you want to buy? If so what % amount is it usually?
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No. It is an earnest money deposit which will be with a contract if you put one in. It will be deposited within 3 days of them accepting your contract and be held by the title company of YOUR choice. The title company will cash it and it will be in escrow during that contingency period.
It depends on the type of house but for a 300k house, 5-10k is typical. But do put contingencies into the contract if you want to have a home inspection, or a financing contingency, to be sure it appraises, or address any other concerns into the contract.
Your agent should advise you on all of this.
Once those concerns have been addressed , waved, or whatever by you, the listing becomes pending. At that point the EMD( deposit) cannot be refunded if you walk away. However, with contingencies in place, you can do your due diligence and be comfortable with the deal before it goes from contingent to pending.
Hope that helps.Comment -
Thank you.
My head is just spinning.
It sounds pretty complicated and trusting a real estate agent, that I don't know is just a degree above an offshore bookie...Wow.. I know it's my ignorance.Comment -
Let me try to re-phrase this a little: Is the earnest money considered part of the down payment or is it a separate?
I mean the buyer generally has to also pay closing costs today as wellComment -
Let's say an inspection uncovers termites or a problem with the pipes... Is the earnest money gone? I don't quite get it.Comment -
Not if you make the contract contingent on a home inspection. You can walk away if you choose or negotiate the price down.
You have all the power if the home inspection is contingent in your contract .
If it is not contingent you will lose your deposit if you walk. So make it contingent!Comment -
Use a Redfin agent and save 1/2% of the price. They work for 2 % commission.
What is the commission offered on the property? 2 1/2 or 3 %
It is in the listing usually at the bottom somewhere.
You will keep the difference to help pay your closing costs.Comment -
To be clear, your agent will be paid by the seller not you. They work for you for the commission offered by the seller.
You have no cost for that service.Comment -
Curious how this goes
Most properties under $250/ fsf selling for cash only "as is" still.
It's crazy.Comment -
Go hire an agent from long and foster or any reputable company. I said Redfin because it will save you money. But it seems you need hand holding so maybe it's better if you don't try and make money on the deal but just have someone to talk to. Goggle is a response from mostly idiots quite frankly. I'm getting worn out trying to help and having goggle to answer to.
Sign up with an agent so you have to use them for a length of time like 90 days to buy a house. That is standard.
They have a legal duty to explain all that I have and more to you.
They will get paid for it by the seller. I won't.
Having bought and sold over one hundred properties , roughly 25 sold for 7 figures in Bethesda Md. ( goggle those houses for new construction), all I told you was the truth and is accurate. That said, I'm getting worn down by the skepticism.
You REALLY do need an agent. Not me.
Best of luck.Comment -
"AS IS" is the last thing this guy needs. That means no home inspection contingency.
He needs to be sure, I respect that. He really needs to find an agent.
"As Is "houses are falling down or way out of code for an addition or something which is fine if you are going to renovate them but NOT this poster. He needs an agent AND a home inspection for sure.Comment -
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Learning more about a Redfin agent. The more I read the more I like what it says.. Thanks STR!
Will try and locate one here very soon. Thanks for your help!!!!!!!!!!!!!!!Comment -
When all is said and done, I'm likely too old to go through the buying and ownership process. I'm just between a rock and a hard place at my age and living in a high price home area. It's that I have the cash for a down payment that would be less than rent which is going through the roof and the corporations lie or bend the truth . I'm sure real estate agents are similiar in what they say and do. They know how to maneuver, which I don't ...Laws seem to be on their side. I was given the name of a realtor from an attorney that did my will. Her specialty is real estate. When I looked the company up ; there were 2 major complaints and one with pictures, that were taken after closing Problems with toilet backing up etc..You would think this would have been found in a home inspection. But it's another world today. Thanks for the info, once again.Comment -
That's the problem with internet comments. No way is a backed up toilet an agents fault. Very unfair feedback. Maybe there was no home inspection?? Or maybe it was the owners fault ( most likely).
You can buy a condo but there are HOA fees and property tax to deal with. Got to look at all that.
How about an over 55 condo? Any of those around where you live? It's maintenance free living.
Just do the math on rent and HOA payout per year vs. Mortgage and property tax and home maintenance. Also, the cash you have is providing you solid peace of mind. Having access to cash allows you to sleep like a baby. I assume you might be 69 years old from the 52 in your name?
What ever your age, having cash is a big sense of security. As we all get older, that really means a lot. Sometimes not making the absolute best decision to earn, earn, earn with every dollar you have is actually a good decision. Because with that, comes risk. Maybe just a little and maybe a lot. You have the money, you are comfortable and relaxed, and you do not have to move. So take a step back and enjoy the security that money put away provides. You have earned that.
Do not do something that might possibly take that security away. Put that cash in Ally Bank or a safe place that earns you as much interest as possible and enjoy the fall season. You've earned that.
If your hesitation wanes, look for a place over the winter. Typically the winter season if it gets cold where you are can be the best time to buy. Especially with a house or condo that has been on the market for over 30 days. Nervous sellers can mean bargains.
Additionally, do know that you would be buying into the tail end of the height of the housing boom. As soon as interest rates start to creep back up, and they will in probably a year or so, the housing market will correct itself somewhat. Not terribly, but it has to step back a little.
Measure twice, cut once has worked for me my whole life. In both occupations. It seems to be working for you as well.
Thank you for the kind words and good luck with your decision. Sounds like you are leaning towards stopping and thinking about it.
Because of the timing of your inquiry into the housing market, I don't see how stopping and thinking about it can be anything but a positive.
All the best.Comment
