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FAQ How Much Earnest Money Should I Put Down
How much earnest money should I put down?
The amount of earnest money varies from one purchase to the next. There is no set formula or amount. The earnest money works as a deposit of buyer’s interest to the seller. A serious buyer is more likely to put down a sizeable deposit. Sometimes sellers request that buyers put down more earnest money than offered. After all they are taking a risk removing the home from the market. Asking the buyer to take a greater risk in the process seems only fair to the seller. Your local real estate consultant can advise you regarding an acceptable amount to help insure the offer is accepted by the seller.As a general rule a dollar amount of 1% would be a good indication to the seller that buyer is ready to make the purchase. The more serious the buyer the more likely the seller will be to negotiate and together come up with an agreement that meets both parties needs. Let’s be reasonable if a $500 deposit of earnest money is offered on a $500,000 house it doesn’t scream ready, willing and able buyer.Yet a $500 deposit on a $100,000 house may be acceptable. ... more

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