Earnest Money
One topic of interest to every home buyer is that of "earnest money". Earnest money is paid into escrow at the time an offer is made on a house. This money is the buyer's way of demonstrating interest in completing a sale. If a buyer enters into a contract and later breaks it, the earnest money is in jeapordy. In some circumstances, it may be non-refundable. (In these cases, the seller would receive the money).
How much earnest money should you put down? There are lots of opinions here. Generally, a buyer will want to put as little as possible down, perhaps 1% of the purchase price. A seller will want to see as much as possible. A higher earnest money deposit generally signals to a seller that the buyer is more interested in "closing the deal". A buyer wishing to strengthen his or her offer may want to put much more earnest money down.
Earnest money amounts generally vary by area. Don't hesitate to ask for advice as to how much is appropriate for a given transaction.
