Earnest Money on Property Offer (real estate, brokers, lawyer)

[221B]

What is the customary amount to offer when tendering an offer on a house in Maine? Is it usually a percentage of the offer/asking price?
Also, can it be either check or M/C-Visa?
Thanks.

[Submariner]

I do not know. We did that once in 1984, in California, it was 'required' for the purchase to be under contract, to begin the escrow process. I do not think it was an actual percentage of the purchase though.

After four other properties we have never seen it required since then.

[mainebrokerman]

depends on a few things-it contributes to the strength of an offer,,,along with other things, like do you have to sell to buy? its usually a check to be held by the broker, and is part of the closing



it can be a thousand dollars, or a few thousand...

[maureenb]

I signed an escrow check just today. It is an arbitrary number - significant enough to let the Seller know my intention is to buy his property. Didn't answer your question, though.

$2,500 No brokers involved, so my Lawyer is holding it.

Closing April 3rd! Woot!

[AustinB]

Originally Posted by maureenb

I signed an escrow check just today. It is an arbitrary number - significant enough to let the Seller know my intention is to buy his property. Didn't answer your question, though.

$2,500 No brokers involved, so my Lawyer is holding it.

Closing April 3rd! Woot!

Whatcha gettin'?

[delmioquartiere]

Originally Posted by maureenb

I signed an escrow check just today. It is an arbitrary number - significant enough to let the Seller know my intention is to buy his property. Didn't answer your question, though.

$2,500 No brokers involved, so my Lawyer is holding it.

Closing April 3rd! Woot!

I had a friend sell his place and the buyer put down $10,000 well you can guess the rest, buyers remorse felt if they waited a few more months they could get it cheaper after they already put down $10,000 good faith money to move forward and purchase. The property already had a home inspection and the prospective new buyer had no out as my friend said if anything was wrong he would make it right after all
he had $10,000 to work with, Theirs.

Bottom line $1,000 is fine to let a buyer know you are interested. Oh by the way the couple walked away from their $10,000 as they had no recourse. Personally I'd have tried to go after my agent for ever letting that happen. Older couple too but a contract is a contract. A tough lesson to learn late in life.

I'll add this was in 2006 not a booming time in real estate in the Northeast.
The buyer had all kinds of excuses like his wife had a stroke and later my friend found out it was all to try to let him out of the contract. I told him that was the case as well as I said a contract is a contract-legal and binding. I knew they had buyers remorse and just wanted out. What I'll never understand was why they put down a $10,000 earnest money.

[mainebrokerman]

Originally Posted by delmioquartiere

I had a friend sell his place and the buyer put down $10,000 well you can guess the rest, buyers remorse felt if they waited a few more months they could get it cheaper after they already put down $10,000 good faith money to move forward and purchase. The property already had a home inspection and the prospective new buyer had no out as my friend said if anything was wrong he would make it right after all
he had $10,000 to work with, Theirs.

Bottom line $1,000 is fine to let a buyer know you are interested. Oh by the way the couple walked away from their $10,000 as they had no recourse. Personally I'd have tried to go after my agent for ever letting that happen. Older couple too but a contract is a contract. A tough lesson to learn late in life.

I'll add this was in 2006 not a booming time in real estate in the Northeast.
The buyer had all kinds of excuses like his wife had a stroke and later my friend found out it was all to try to let him out of the contract. I told him that was the case as well as I said a contract is a contract-legal and binding. I knew they had buyers remorse and just wanted out. What I'll never understand was why they put down a $10,000 earnest money.

this does happen,,,brokers cant give specifics on past transactions by law,,so its tough to use actual examples..
but this does happen..

on one commercial property a buyer asked if he could postpone the closing date, the owners/sellers said ok, but they wanted some more earnest money to hold, to ensure the buyer was still serious and the owners liked this buyer-they stopped advertising the property because of their contract..
anyways, the buyer at the last minute wanted out ....without losing his earnest money
it became a war between two lawyers,,,and lawyers love a battle-they get paid for billable hours, not resolutions..


so yes, as a buyer, i wouldnt put a huge amount of earnest money out there-
only if its a multiple offer situation, and you really want the property..

[roadrat]

My DW and I only put down $100.00 on the house we bought 12 years ago.




bill

[WhoFanMe]

Originally Posted by 221B

What is the customary amount to offer when tendering an offer on a house in Maine? Is it usually a percentage of the offer/asking price?
Also, can it be either check or M/C-Visa?
Thanks.

Real estate is local, what does your buyer agent recommend? That amount could differ based on where in the state you are, the existence of other offers, type of financing, length of contract prior to closing, etc.

[221B]

Ok, thanks for the perspective on this amount. It helps to know the ballpark amount specific to Maine, since this is a bit different in CA. This thread has been very helpful.