Real Estate Earnest Money Deposit, What Happens To It?
The real estate earnest money deposit that buyers for a property are asked to ker plop down.
When signing a purchase and sale agreement to buy a listing. Money put down in good faith, earnest funds put up as a sign the real estate buyer intends to really buy. No fingers or toes crossed. This is real serious stuff.
How much is enough, what happens to the real estate deposit if the property listing closes or not?
There are two parties at least involved in a real estate sale.
Waiting, idle while things happen or not in a real estate sale. The security of a sale with a person the seller may have never met is the down payment, real estate deposit.
The real estate earnest money deposit for starters that is designed to give the property owner assurance that the buyer is really putting their money where their mouth is.
That this offer to buy the real estate for sale should be taken seriously. The larger the deposit, the less long the list of contingencies or delays in getting to the actual real estate closing the better.
The earnest money real estate deposit says take it off the market, park it.
While whatever has to happen to get the rest of the money to buy can run its course. To be combined with the earnest money deposit for the total balance needed to meet the agreed upon purchase price. If the math is right on the HUD-1 and all the other numbers associated with the real estate sale jive correctly.
The size of the deposit can matter more if multiple buyers are on the scene of the real estate listing for sale.
The real estate deposit is assurance every buyer is serious and to what degree.
The bigger the better. Size does matter.
And another deposit to the real estate trust account could be coming.
To up the ante along the way to assure the seller, pick me over all others please by George.
The real estate earnest money put down on a property listing for sale is held in a special trust account. It gets delivered to the closing if all goes well. Or if the sale fails no matter how many twists and turns and efforts to keep it alive.
The deposit can be returned to the buyer for the “nice try”. But because of the house not appraising for enough, the repairs to it to get financing are not being done because of lack of money on either side to correct the issues.
The real estate earnest money deposit can go back to the buyer if the contingency about bank financing is not met during the time spelled out in the purchase contract.
Title problems that can not be unknotted in time or at all can be another reason to hand it back.
Divorce, loss of job when the buyer gets a pink slip, disease or death all take their toll on the real estate sale happening or not.
But if the conditions of a real estate sale in Maine are made, and the buyer finds another property they like better, wants out.
That deposit is forfeited unless the seller too got cold feet. And is glad they backed out of the sale, moved on or just came up short.
Usually though, the seller feels tied up, bruised, not so happy as the property has been off the market. Lost other opportunities for a real estate sale. And when the listing comes off “sale pending” to active, the audience wonders what did really happen?
The inkling, gut feeling that the property listing came up short, something is wrong with it is a signal that can be picked up out in the wild blue yonder.
Buyers usually are in the market for awhile.
They watch, listen, learn and draw conclusions. Right or wrong.
Fights over the real estate deposit are the most tedious for the agent, broker.
Who’s main job in life of wearing the REALTOR “R” is to preserve the sale. Get to the closing for the pass the keys, get up and shake everyone’s hand because we made it. Whew.
Sometimes splitting the deposit is an option.
Instead of it going all one way or the other. Hard feelings, disappointments on both sides can happen and the real estate agent or broker does his/her best to smooth feathers. Move on and learn from the experience that did not go as planned for a slew of reasons.
Real estate deposits, they can also earn interest for the buyer or seller if designated in writing on the contract to purchase.
But never are they making interest for the real estate agent or broker. It is not their money, just being protected and held in a special very regulated, watched trust account for just that purpose.
To hold together the sale with a good faith money amount put into the real estate transaction going in, upfront. When everything is hopeful, rosey smooth sailing leaving the harbor. When everything in the real estate sale starts with the best of intentions. Sellers of real estate in Maine really want the sale to happen, not to pocket the much smaller deposit check as a little something for their trouble.
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MOOERS REALTY 69 North Street Houlton Maine 04730