15K Deposit after Attorney Review. Buying a house. Is this Normal??? (condo, closing)

[Pianist718]

Hi all,

I am submitting an offer on a townhouse I plan on buying and I am being asked to give at least 10k 10 days after attorney review process, that is assuming that seller accepts my offer. Is this a normal procedure? This place is not hot and they don't have any other offers at this moment. Why am I being asked to motivate them with a 10-15k deposit?

Any feedback would be greatly appreciated.

Townhouse value in mid 300k and in state of NJ.

[nybbler]

An earnest money deposit is normal. It's not to motivate the seller; the money goes in escrow. It's to make sure there's some cost to you if you bail for no reason or if you delay the process.

[nykstevenyg]

It's very normal.

[pinkydapimp]

This is normal.

[aquafriday121]

$10k is not that much for a house in the $300k value range - it's the minimum you'd be allowed to put down on a property (assuming FHA?). The first time I bought a house was in 2008 and I only needed to give a couple thousand bucks for down payment but this time around - after the housing crash - I was asked to put in escrow the full amount of my deposit.

[jaymoney]

You're not looking to motivate them. You're looking to tell them that you're serious about buying. If you can't come up with 10-15K for a down payment how are you going to get 300K in a mortgage?

[Goldendoodle1969]

totally normal is $1K check with any offer and $10K-$20K due after attorney review. All of that money is held in escrow account until deal closes.

[ArchtSean]

Yea I bought a condo in NJ last year it was a lower value but I only gave a 1k earnest deposit. I did have to show that the rest of the funds were in an account and ready to go but I didn't have to risk it if anything fell through on the unit.

[newdude05]

Originally Posted by Pianist718

Hi all,

I am submitting an offer on a townhouse I plan on buying and I am being asked to give at least 10k 10 days after attorney review process, that is assuming that seller accepts my offer. Is this a normal procedure? This place is not hot and they don't have any other offers at this moment. Why am I being asked to motivate them with a 10-15k deposit?

Any feedback would be greatly appreciated.

Townhouse value in mid 300k and in state of NJ.

It is normal after attorney review has concluded to make a deposit of 10-20k to the attorney's escrow.

However what you stated especially the part i highlighted makes no sense.

You do not go into attorney review until seller accepts the offer and signs the contract, so why are you in attorney review when the seller hasnt even accepted the offer?

The normal steps are below, if the seller wants to do something different tell them to screw off, especially since it's not a hot property as you said.

1) You make offer
2) Seller accepts offer, and contract is signed (no money being exchanged at this point, it used to be pay you put in a $1k deposit check but NJ has largely done away with this practice)
3) Contract goes into attorney review
4) Attorney review concludes
5) A deposit 10-20k is put into the seller or buyer attorney escrow account.
6) Remaining amount paid at the day of the closing.

[Penga25]

normal stated above.... basically if you after the seller takes the house of the market, begins the move out process, buys a new house, etc decide you dont want it any more for a non legitimate reason. they are entitled to keep your deposit, its your penalty for breaking YOUR end of the contract.