The initial deposit a Buyer is willing to make to purchase a home is a good indication of how serious and credible thier intentions are. When lending standards were more lenient, we would usually accept a purchase offer with less than a 3% deposit. In California a 3% deposit is the benchmark for deposits, since the liquidated damage clause in the purchase agreement limits the Buyers liability to either 3% or the amount of the actual deposit, whichever is less.

 Now it seems that we see more offers written with a $2000 - $5000 deposit. And although we always recommend to our seller that we counter to increase the deposit, this can be difficult to achieve if the house has been on the market for 3 months without an offer. Sellers are anxious to open escrow, provided they can live with the offer price. These also seem to be the transactions that never close on time and seem to be problem plagued.

To counter a low deposit we have inserted clauses that upon "contingency removal" the Buyers deposit is released to the seller and is not to be returned, should escrow cancel. Again, this is very little consolation to a Seller who has been in escrow for 30-45 days.

What other things do you do to counter a low deposit and have you also found yourself in similiar situations?