what is the difference between a good faith deposit and a down payment.?

Question

When buying a house.

If there is a big difference, could you define each term seperately?

Answer 1

A deposit is made before the "deal" is done. It can "hold" the house while you arrange for inspections, financing and whatever. It may or may not be refundable if the deal is not closed (read the agreement). It may or may not be apllied against the cost when the deal actually closes (again, read the agreement). This deposit is part of the dealing with the seller.

A down payment is simply "in effect", your first payment to the mortgage holder.

Answer 2

A good faith deposit is used to let the seller know that you are serious about the purchase and that in accordance to the terms of the agreement such deposit will be used according to those terms and it tells the seller that if you do not meet the terms of the agreement you will loose the good faith deposit and it will then be considered final payment for damages. The down payment is the amount of money that will be tendered by you to reduce the final agreed upon purchase price with or without the good faith deposit.

Answer 3

A good faith deposit is given so that a person will hold an item for U. If you change your mind, the deposit may be kept by the seller since he, by holding the property for u, could have lost other sales. A down payment is refundable if the sale doesn't go through. If the sale goes through, the deposit will become part of your payments or down payment.

Answer 4

A good faith deposit shows the seller that you're serious about purchasing the home. It covers the initial expenses of selling the home and closing costs, etc. If the sale goes through, your good faith deposit will be credited towards your down payment.

Answer 5

Same thing just different termanology

Answer 6

Money, Money, Money.