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Oct 10 2017 What You Need To Know About Your Earnest Money Deposit
Dated: October 10 2017
"Are you dreaming about owning your own little piece of Texas?
Well it's time to stop dreaming and COWBOY UP! We can make your dream come true"!
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The earnest money deposit is money that is placed into an escrow account. It is sort of like a security deposit. It informs the seller that you are a serious buyer.
The funds will be applied towards the closing of your transaction. This is required in all real estate contracts. If you don’t have at leastone percent of the sales price to offer as an earnest deposit, you should wait on placing any offers until you have the funds available. If you are making an offer in a competitive market, you may want to increase your earnest deposit to make your offer stronger than the other offers.
That being said, in some locations it’s not uncommon to see simply $1000 to $15000 asked for the deposit.
The earnest money deposit is placed into the escrow account within a few days of an accepted offer so you need to make sure you have the funds available for immediate withdrawal. TREC Rule 535.146 requires that unless a different time period is agreed upon, any trust money, including earnest money received by the broker, must be delivered to an authorized escrow agent within a reasonable time. The commission has determined “a reasonable time” to be not later than the close of business of the second working day after the date the broker receives the trust money. If you decide to cancel the contract while you are in escrow, there is a chance that the seller may be entitled to your deposit. Make sure you read the contract thoroughly so you will know what to expect.
Know this, even if you are within your full rights to cancel the transaction and receive your earnest money back, in some states like Nevada, the seller has the right to hold it up during a dispute over the earnest money. When you place your earnest money check in escrow, there is no guarantee of a quick return should you decide not to by the home for any reason. Ask your REALTOR® about your state laws.
Also, be sure to read your counter offer clearly. It’s not unheard of for a seller to ask the money to “go hard” after a certain point. That would mean they receive the earnest money in full before closing. Your earnest money should not be taken lightly. By definition: Earnest: resulting from or showing sincere and intense conviction. If you don’t intend to buy, don’t put earnest money on the table.
Contact us today to list your home for sale, or to purchase your next home
"Are you dreaming about owning your own little piece of Texas? Well it's time to stop dreaming and COWBOY UP! We can make your dreams come true! I make LONESTAR DREAMS come true everyday!
Texas Real Estate Consumer Protection Notice