How Much Earnest Money To Put Down

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Real Estate Broker/Owner with Real Living/Home Realty 24642

Owensboro Real EstateHOW MUCH EARNEST MONEY TO PUT DOWN

 The buyer is the one who decides the amount of money he wants to pay down with his offer but the larger the deposit the stronger the buyer looks to the seller. No earnest money deposit is required in order to make a contract binding however most sellers will ask for an earnest money deposit to show a buyer's good faith, but it is not required for consideration.

 

If you have two offers on the table and one is for $250,000 with no earnest money deposit and the 2nd offer is for $250,000 with $5,000 earnest money deposit, which would you consider the stronger buyer?   If you have an earnest money deposit the seller feels he has a better chance of holding the buyer to the contract much more than a buyer with no deposit.  When you find the home that is right for you, a reasonable earnest money deposit just may insure you seal the deal.

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Rainer
144,389
Victor Zuniga
Berkshire Hathaway Home Services California Properties - San Diego, CA

i usually advice a sum between 1% to 3% or so unless the clients really love the home and can place a larger sum to make their offer stronger.

Feb 09, 2011 06:47 AM #1
Rainer
121,804
Jeremy De La Garza
Corpus Christi Realty Group - Corpus Christi, TX
Corpus Christi, TX

I agree with Victor, $500 minimum or 1% and 3% if it's a multiple offer situation. A deal with no EM is a deal waiting to fall apart or a dead deal. All cash deals I ask for a little more.

Feb 09, 2011 07:19 AM #2
Rainmaker
722,730
Connie Lou Barnett
Real Living/Home Realty - Owensboro, KY
GRI,CRS,CRB,SRMM,ARA,PRS,SFR,QSC

Hey Guys thanks for your comments and stopping by my site.  Wishing you a very successful year of sales.

Feb 11, 2011 10:53 AM #3
Rainmaker
131,383
Karen Pannell
Real Living / Home Realty - Owensboro, KY
Owensboro KY Real Estate -270-903-2167 Homes, Cond

I once worked with some people who were moving from PA to KY.  The buyer was relieved when I told him it needed to be around 1% - the last house he bought in PA required a 6% Earnest Money Deposit!

Feb 14, 2011 04:55 AM #4
Rainmaker
1,431,581
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

I encourage my buyers to put in as much as they can afford up to the max of 3%.  The more you put in the better it looks.

Feb 17, 2011 05:31 AM #5
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Rainmaker
722,730

Connie Lou Barnett

GRI,CRS,CRB,SRMM,ARA,PRS,SFR,QSC
Get the Service you deserve! Call Connie Lou Barnett today.
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