@JusdoNit wrote:
@Anonymous wrote:
In the process of buying a new home everything seems to be going smooth with the seller and my agent is great. So far here's where I'm at. Picked the house Got the offer together submitted that to the company they countered that we accept there's. Went to there office with agent and signed all the paper work and signed a 500 check for escrow. Now my agent is wanting to set up an inspection which I'm sure it will come back fine cause its a model home and no ones lived in it. Now I'm preapproved through my local bank for usda .so when does the loan officer jump in and discuss closing cost and what my true interior rate is instead of saying its 3.75. Is it locked in yet or what? This is all new to me ill be calling her in the morning was just trying to get an idea tonite as to when she jumps in cause everybody else is on it. ThanksWOW! $500 earnest money. It must be nice. We were hit with a little over $2k
In a buyer's market, earnest money is quite easy to negotiate. If someone tried to strong-arm me and I wasn't giggling with excitement to buy that particular house, I would offer $500 as a "take it or leave it". Too many things can happen between the offer process and closing to lose 2 grand when the deal falls through. IMO, earnest money isn't about being "serious" about an offer, but rather to allow those involved in the selling process to siphon as much money out of your wallet in case something goes wrong.
$500 is a good, happy medium. The listing agent for the home we are closing on (just under $100,000 listed, appraised at well over that with USDA preapproval in hand before the showing) initially just flatly stated $1,000. When I corrected her with $500, she didn't skip a beat. We simply moved forward. Heck, I didn't even pay the earnest money until the offer was accepted as we submitted it. It was stipulated in the offer that we would pay that money within 24 business hours of notification of offer acceptance...and that failure to do so would constitute the offer being null and void.
Buyers in a buyer's market need to remember that THEY are in the position of strength unless the property in question is in high demand with multiple interested parties/offers. Never allow a listing agent to dictate each and every term to you because nearly all terms are negotiable when you put in that original offer.
The only thing that kept me from trying to negotiate the earnest deposit is that all the houses in this particular area are being bought by investors with cash. Trying to score a newly built (2006) 4 bdrm/ 2 1/2 bath home at 55k here in Las Vegas was pretty tricky! I had put in 6 offers total on homes and looked at about 100 houses total. Though I don't like having 2k held up, I've been sticking through this situation since March... and still waiting for the bank's written approval (and we're scheduled to close in 23 days....).
@LondonMassey wrote:The only thing that kept me from trying to negotiate the earnest deposit is that all the houses in this particular area are being bought by investors with cash. Trying to score a newly built (2006) 4 bdrm/ 2 1/2 bath home at 55k here in Las Vegas was pretty tricky! I had put in 6 offers total on homes and looked at about 100 houses total. Though I don't like having 2k held up, I've been sticking through this situation since March... and still waiting for the bank's written approval (and we're scheduled to close in 23 days....).
Ah...see, in your case there IS a compelling reason for the realtor to hold you hostage with high earnest money. In most cases, cash buyers aren't swooping in like that...well, not in Indiana anyway 
