We have not closed and are still in the process of negotiations.
2007-08-18 07:04:18 · 9 answers · asked by Cheryl N 1 in Business & Finance ➔ Renting & Real Estate
your $$ is put into an escrow account which holds the money & either gives it to the seller if you back out or if the deal goes through, it goes towards the price of your new home
2007-08-18 07:07:44 · answer #1 · answered by lauren s 5 · 0⤊ 0⤋
Yes. That is what they are supposed to do. Then they hold that money in trust, as a neutral third party. Closing is the final part of the transaction, where you get the deed and the seller gets the money.
When you say you are still in the process of negotiations, I must assume that there is a purchase and sale agreement signed by both parties, and the negotiations are about inspections, repairs or other similar details. Otherwise earnest money does not normally come into play. (If there is no "signed around" purchase and sale agreement, then the title company should not cash the check, or even have the check for that matter until escrow is opened.)
Remember that earnest money is a way to assure the seller that you are serious and that you won't simply back out of the deal for no reason. If you do, then the seller may get some or all of your earnest money to help reimburse the seller for their trouble and for the lost sales opportunities they may have had while you had the property under contract.
This gives the seller the confidence that if you default, he/she won't be stuck with a canceled check and have to go to court to get the earnest money.
2007-08-18 07:20:21 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Honestly, if you don't have a mere $500 in savings to write an earnest money check right now, then you don't have any business buying a house. Inspections will cost AT LEAST that. You'll also have to pay for a year's worth of insurance all at once...also AT LEAST $500. When I bought my first house I had about $15,000 saved up. Even I was surprised at how quickly that went during and after the buying process -- and I bought my house with ZERO down. It doesn't sound bad. It just sounds like financially you're not prepared to buy a house. As much as you want it, from what little I know, it's just not a good time for you.
2016-05-22 03:25:53 · answer #3 · answered by isa 3 · 0⤊ 0⤋
Once you tender a check to a title company they are obligated to follow the instructions on the offer to purchase which says "I agree to tender $ as earnest money" once that is done they are obligated by law to place those funds in an escrow account and to do so they have to deposit your check immediately or by the next business day. If you just gave them a check without instructions on what to do, they'll hold the check for instructions.
2007-08-18 08:15:58 · answer #4 · answered by newmexicorealestateforms 6 · 0⤊ 0⤋
Of course they can! In fact, they have to! Normally that won't happen until you have an agreed contract and the escrow process has been started.
Since you are still negotiating you don't have an agreement yet and are not in escrow yet so the check probably won't be cashed just yet.
2007-08-18 07:25:35 · answer #5 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Yes they can cash your check. They actually put the money into an escrow account until the time of closing. If you back out of the deal that money is gone.
2007-08-18 07:19:52 · answer #6 · answered by D and G Gifts Etc 6 · 1⤊ 0⤋
Yes, they can cash the earnest money check, so expect it to clear your account.
Some lending institutions actually require evidence that the earnest money deposit check has actually cleared your account before they will place it on the HUD.
2007-08-18 07:11:33 · answer #7 · answered by Expert8675309 7 · 1⤊ 0⤋
Your money will go into an escrow account and it will definitely be cashed.
2007-08-18 07:13:34 · answer #8 · answered by Suzy 5 · 1⤊ 0⤋
yes. Most earnest money deposits are not refundable.
2007-08-18 08:09:04 · answer #9 · answered by Anonymous · 0⤊ 0⤋