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a photo copy a bank check is fine until you get a signed, accepted offer. Let them know this is the way its done. If they wont accept it, you will find another realtor who will.
Ummm yeah... around here, you need a real, live check for earnest money in your hand if you want to write an offer. The agent has to immediately deposit that check if the offer is accepted by the buyer.
Writing an offer without a real check is dangerous for the agent. If the offer is accepted, and you don't pay up, the agent might have to make the check good.
Earnest money can be in any amount, but it isn't money if it's a photocopy.
I think this is probably just bad practice based on the requests of so many lender-owned properties. The asset managers want a photocopy, the agents only get a photocopy.
I am a buyer and for EMD do you give it to your agent or the title insurance company? title insurance company and escrow company are they separate or together? thanks
I cannot speak for how escrow payments are handled elsewhere, but in the state of Florida they are usually in the form of a personal check that is deposited into an escrow bank account held by a broker, title agency or an attorney's office. The checks are deposited, but not dispersed until the real estate closing. I have never heard of a single instance of cash being deposited as escrow.
I have never asked for an escrow check until I have a signed contract by both the buyer and seller. I have had a copy of the escrow check requested by the selling agent when submitting contract offers.
Not having bona fide funds with an offer would be considered an ethics issue around here. HOWEVER, don't forget many banks now have the ability to deposit on a photo copy. In our fast-paced docu-sign days, our rules and regs are having a tough time keeping pace.
can I claim the deposit on my tax, I could not go thru with the loan process because one of the person back out on purchase the house so the builder keep the deposit, also cam I claim the fee for inspection of the new property
In most parts of the country, real estate agents must use an approved contract (approved by state), and the contract will say that a certain amount of money is to accompany the offer, to be used as an earnest money deposit.
If the offer is accepted by the buyer, the check must immediately be deposited into the listing brokers escrow account.
If the offer is rejected, the deposit is to be immediately returned to the buyer.
Without the actual check, the offer is not really an offer. To meet the conditions of the offer, a deposit check must accompany the offer when it is signed by the buyer.
A photo copy of a check, is worth nothing, and is not considered part of an offer, as the buyer may not submit the actual check after the offer is accepted.
Any legitimate real estate brokerage is going to carry O&E insurance to protect the person giving the check, as well as any other errors or omissions they may make. The amount will be from $100,000 and up. I had $1,000,000 coverage when I was a broker for many, many years working with commercial and investment real estate. It was cheap, and I never had a claim put against me.
If you don't trust the real estate brokers you are working with to give them a check as a deposit, then get another broker you feel you can trust.
Without the actual check, the offer is not really an offer. To meet the conditions of the offer, a deposit check must accompany the offer when it is signed by the buyer.
This is an interesting old thread. It's apparent that practices vary greatly in different areas. As a Buyer's Broker, I can't remember the last time I submitted a check along with an offer. Besides, if some distance is involved (which is usually the case in the properties I deal with), offers are oftentimes delivered via email.
Most of the contracts I deal with call for the deposit to be immediately delivered to the title company upon acceptance, usually by the next day. I'll either hand-deliver the client's check--or they'll wire the money directly to the title company. I've never experienced a problem with this method.
This is an interesting old thread. It's apparent that practices vary greatly in different areas. As a Buyer's Broker, I can't remember the last time I submitted a check along with an offer. Besides, if some distance is involved (which is usually the case in the properties I deal with), offers are oftentimes delivered via email.
Most of the contracts I deal with call for the deposit to be immediately delivered to the title company upon acceptance, usually by the next day. I'll either hand-deliver the client's check--or they'll wire the money directly to the title company. I've never experienced a problem with this method.
The issue isn't when you deliver the check (as soon as practical after acceptance), it's the agent having that actual check in their control & possession when they send the offer, versus a photocopy of a check.
During the rush after the crash here, when there were insane numbers of short-sales listed for sale- some people twisted the meaning of documents required for a valid offer. If I have a short-sale listed, I want to know the buyer is (earnest) and willing to perform, so I require a photocopy of the actual, real live check be submitted with the offer, otherwise, the offer goes in the trash. By doing that, I'm trying to verify that the buyer's agent actually has that check in their possession, not to verify the buyer has access to a copy machine. If for any reason, the offer is accepted & that check doesn't get deposited - I'm going after the buyer's agent/broker for that money. In the past, some agents were using photocopies of one check to write multiple offers on different properties.
That mentality has burned out since the market here slowed down.
Iowa January 2007
Kentucky September 2009
Colorado August 2014
Once our offer was accepted we gave our physical EMD check to our buyer's agent who in turn gave it to the listing agent. The original wasn't asked for nor was a copy of the check when we submitted each offer.
In Colorado everything was done electronically. Offer, inspection repair requests, their counter, our refusal of their counter, their acceptance of our repair requests on our terms. Only the check was physically given to our buyer's agent. Everything else was via email.
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