You will need a significant amount of cash to purchase a home. Most home buyers will use a conventional, FHA, or VA loan to purchase a home. Depending on how your contract is structured, you will need a down payment, earnest, money, deposit, and closing costs.
With a VA loan it is possible to purchase a property with a small amount or sometimes no amount of cash. These terms should be explained to the home buyer who is working with a qualified local lender to purchase the property.
The earnest money deposit is money that is placed into an escrow account once the contract has been ratified. Ratification happens when the buyer and seller have agreed on the terms of the contract and have signed all the documents making the contract enforceable. In the Washington DC area the earnest money deposit is typically between three and 7% of the sales price. In a competitive market like we are seeing now in spring 2023, earnest money deposit can be much higher.
Learn more about what to expect when purchasing a home on my website, homebuyerbrokerage.com. Our brokerage is dedicated to serving only homebuyers in the greater Washington DC and Baltimore areas. We are an exclusive buyer brokerage. All our agents are licensed Realtors in Virginia, Maryland and Washington DC.