2007-01-18 05:13:34 · 9 answers · asked by Raina 2 in Business & Finance ➔ Renting & Real Estate
ok, maybe I should elaborate. My husband and I are trying to buy a house. It's being sold by owner. The owner said that when we sign the contract that we will have to give them $500 earnest money. Is this right? And if so, will THEY cash it?
2007-01-18 05:30:14 · update #1
Usually the escrow company holds it, and can not release it to either party with permission from BOTH parties.
If the sale goes through, the money is applied to the sale. If the sale falls through and the buyer defaults, the seller should get to keep the money.
It's never that easy though.
2007-01-18 05:21:57 · answer #1 · answered by Captain Jack 6 · 1⤊ 0⤋
Earnest money is often forfeited if the customer refuses to bypass by with the transaction, even with the reality that there are particular loopholes in that, ie, did not bypass inspection, appraised below fee, ect. study that purchase and sale heavily and word if those complicated products fall interior of those words. The realtor is on shaky floor right here. I keep in mind that if the borrowers are vacating they're going to opt for pride that the resources is sound thereafter, and for the reason that the borrower's in touch by the point to purchase, there might want to or gained't were a protection deposit settlement reached previously. Do you've all the documentation in this? became the problem with the furnace stumbled on by a house inspector? there are a tremendous type of lacking products right here. What ought to ensue is in the journey that they realtor refuses to relinquish the money it would want to properly be held by the court docket pending a call about who receives it. i'd anticipate that no matter if it truly is held as protection deposit it would want to be completely refundable. The dispute about the state of the water heater, ect is severe and that i doubt an settlement will be reached. i'd actual advise at this aspect you get a criminal professional in the journey that they are hung up on the numerous of the ingredient. on the different hand $500 isn't that a lot earnest money, right here on the west coast that decision is in the various 1000's even on a modest purchase so that they ought to imagine about their priorities. i'd attempt to succeed in an settlement, in reality, per chance a 50% chop up and anybody cut back their losses. yet actual, without a pre-bypass in walk by, or some type of workplace artwork addressing the furnace challenge, you'll make little headway both way, IMHO.
2016-11-25 01:32:35 · answer #2 · answered by Anonymous · 0⤊ 0⤋
The earnest money deposit is called good faith. In the contract read to see if the seller has the right to keep emd if you should decline buying. Yes, they can ask the the $500. however, the money needs to go to the escrow company. The check should be made out to the Title company, not to the seller.
2007-01-18 07:03:41 · answer #3 · answered by Anonymous · 1⤊ 0⤋
It's negotiable as to who holds it. If I were you, I would have a nuetral third party hold it, like an escrow company with the provision that if you breach the purchase contract, the money to be given to the seller.
Regards
2007-01-18 09:15:49 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Only if you want them to. Most often its better to write the check to the escrow company-- an indpendant third party-- and have them hold it. Then it gets credited towards the buyers closing costs, down payment, etc. (Unless you say 0 down, seller pays closing, in which case the buyer gets it back.)
2007-01-18 05:17:23 · answer #5 · answered by Anonymous · 2⤊ 0⤋
NO, it is not right: In this type of transaction, the transaction agent (real estate company, title company) holds the earnest money. Be aware the earnest money is about equal to the cost of the title search that the title company will have to do for title insurance.
2007-01-18 06:07:15 · answer #6 · answered by whatevit 5 · 0⤊ 2⤋
The owner shouldn't. It should be held in "escrow" by the title company. This way, no one is collecting interest on it. When you close, the deposit will go towards the down payment or closing costs.
2007-01-18 05:39:27 · answer #7 · answered by KL 5 · 1⤊ 0⤋
No. They could, but usually the Title company holds it. The title company is a neutral 3rd party so they don't favor either side. I wouldn't trust the seller to hold it.
2007-01-18 05:21:33 · answer #8 · answered by Anonymous · 0⤊ 0⤋
No, not usually. Your agent will take hold of the check and hand it over to their Broker who will in turn put it in Escrow until closing
2007-01-18 05:27:50 · answer #9 · answered by Anonymous · 2⤊ 0⤋