CurlTalk

How much deposit?

violetsviolets Posts: 1,689Registered Users
I am trying to buy a house and it was stipulated 10% of the purchase price. I want to change it before attorney review is over to 5% but the buyers refuse. I really like the house but the sellers want to sell "as is" meaning they are not willing to repair any problems that come out of the inspection. The house looks in pretty good condition but I don't feel comfortable with 10%.


Is 10% a normal deposit for a house? kEEP IN MIND this is the initial deposit not the deposit I will finally end up putting down.
Is 10% normal for an initial deposit?

Comments

  • cailincailin Posts: 898Registered Users Curl Dabbler
    Do you mean the deposit you put down with the Purchase agreement? Then later you put your 20% down payment?


    When I bought my house (4 years ago) there was no minimum deposit at all. I think I submitted $500 with my form, the seller didn't have any input as to how much I deposited.


    Maybe I'm overly skeptical but a seller that is selling "as is" and insists on a 10% deposit to hold the offer as the sale is being drawn up makes me feel like they're up to something.
  • CurlyCanadianCurlyCanadian Posts: 10,778Registered Users Curl Connoisseur
    I think it must be different up here.

    Do you have to put a deposit down with your offer?

    When I bought my house 4 years ago, you needed to give the bank 5%. I gave 10%, and I think that's what you have to do now.
    I believe in manicures. I believe in overdressing. I believe in primping at leisure and wearing lipstick. I believe in pink. I believe that laughing is the best calorie burner. I believe in kissing, kissing a lot. I believe in being strong when everything seems to be going wrong. I believe that happy girls are the prettiest girls. I believe that tomorrow is another day and I believe in miracles.
    Audrey Hepburn
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    Here we put down earnest money and not a deposit. It's usually $500. But if it's an investment property, you can usually negotiate it down anywhere to $100.

  • violetsviolets Posts: 1,689Registered Users
    cailin wrote: »
    Do you mean the deposit you put down with the Purchase agreement? Then later you put your 20% down payment?


    When I bought my house (4 years ago) there was no minimum deposit at all. I think I submitted $500 with my form, the seller didn't have any input as to how much I deposited.


    Maybe I'm overly skeptical but a seller that is selling "as is" and insists on a 10% deposit to hold the offer as the sale is being drawn up makes me feel like they're up to something.
    Yes, the initial deposit. Not what the bank requires. It's what you give soon after the offer is accepted. The attorney keeps it in escrow until closing.
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    I think it must be different up here.

    Do you have to put a deposit down with your offer?

    When I bought my house 4 years ago, you needed to give the bank 5%. I gave 10%, and I think that's what you have to do now.

    That would be the down payment^^^

    The deposit/earnest money is to show good faith that you are going to show up to the closing and follow thru on the purchase, assuming the seller keeps up her part (but language is often written in to give the buyer an "out" for various reasons including failure to find appropriate financing and a bad inspection).

  • cailincailin Posts: 898Registered Users Curl Dabbler
    I think it must be different up here.

    Do you have to put a deposit down with your offer?

    When I bought my house 4 years ago, you needed to give the bank 5%. I gave 10%, and I think that's what you have to do now.

    That would be the down payment^^^

    The deposit/earnest money is to show good faith that you are going to show up to the closing and follow thru on the purchase, assuming the seller keeps up her part (but language is often written in to give the buyer an "out" for various reasons including failure to find appropriate financing and a bad inspection).


    That's what makes me give the sellers insisting on 10% the side eye. If I remember correctly the initial deposit or earnest money goes to the seller with the signed purchase agreement. And, as you say, if the contract is written well the buyer has an out once they get the results of the home inspection. If the home is being sold "as is" and violets finds out during an inspection that there's black mold, radon, poltergeists....whatever then I think the sellers get to keep that 10% if she backs out.
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    cailin wrote: »
    I think it must be different up here.

    Do you have to put a deposit down with your offer?

    When I bought my house 4 years ago, you needed to give the bank 5%. I gave 10%, and I think that's what you have to do now.

    That would be the down payment^^^

    The deposit/earnest money is to show good faith that you are going to show up to the closing and follow thru on the purchase, assuming the seller keeps up her part (but language is often written in to give the buyer an "out" for various reasons including failure to find appropriate financing and a bad inspection).


    That's what makes me give the sellers insisting on 10% the side eye. If I remember correctly the initial deposit or earnest money goes to the seller with the signed purchase agreement. And, as you say, if the contract is written well the buyer has an out once they get the results of the home inspection. If the home is being sold "as is" and violets finds out during an inspection that there's black mold, radon, poltergeists....whatever then I think the sellers get to keep that 10% if she backs out.

    It could be written so that the buyer (violets) has an out for any reason after the inspection results come in.

  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    You need the right people around you in this situation. I am wondering.
    It's not easy being a princess, but hey, if the crown fits.
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    I think it must be different up here.

    Do you have to put a deposit down with your offer?

    When I bought my house 4 years ago, you needed to give the bank 5%. I gave 10%, and I think that's what you have to do now.

    That would be the down payment^^^

    The deposit/earnest money is to show good faith that you are going to show up to the closing and follow thru on the purchase, assuming the seller keeps up her part (but language is often written in to give the buyer an "out" for various reasons including failure to find appropriate financing and a bad inspection).
    Once you put that out there, you don't get it back.
    It's not easy being a princess, but hey, if the crown fits.
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    cailin wrote: »

    That would be the down payment^^^

    The deposit/earnest money is to show good faith that you are going to show up to the closing and follow thru on the purchase, assuming the seller keeps up her part (but language is often written in to give the buyer an "out" for various reasons including failure to find appropriate financing and a bad inspection).


    That's what makes me give the sellers insisting on 10% the side eye. If I remember correctly the initial deposit or earnest money goes to the seller with the signed purchase agreement. And, as you say, if the contract is written well the buyer has an out once they get the results of the home inspection. If the home is being sold "as is" and violets finds out during an inspection that there's black mold, radon, poltergeists....whatever then I think the sellers get to keep that 10% if she backs out.

    It could be written so that the buyer (violets) has an out for any reason after the inspection results come in.
    No, this is all geared toward the seller, not the buyer.
    It's not easy being a princess, but hey, if the crown fits.
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    cailin wrote: »


    That's what makes me give the sellers insisting on 10% the side eye. If I remember correctly the initial deposit or earnest money goes to the seller with the signed purchase agreement. And, as you say, if the contract is written well the buyer has an out once they get the results of the home inspection. If the home is being sold "as is" and violets finds out during an inspection that there's black mold, radon, poltergeists....whatever then I think the sellers get to keep that 10% if she backs out.

    It could be written so that the buyer (violets) has an out for any reason after the inspection results come in.
    No, this is all geared toward the seller, not the buyer.

    They can negotiate it any way they want.

  • violetsviolets Posts: 1,689Registered Users
    I spoke to the attorney and she said "as is" does not mean they can't make any modifications. She said that what you see is what you get. I still can ask them to pay what comes out of inspection.
    I am very nervous about the whole thing. I did voice my concerns to the attorney. She assured me it is standard language.
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    violets wrote: »
    I spoke to the attorney and she said "as is" does not mean they can't make any modifications. She said that what you see is what you get. I still can ask them to pay what comes out of inspection.
    I am very nervous about the whole thing. I did voice my concerns to the attorney. She assured me it is standard language.

    Make sure it says what you need it to say about being able to void the contract if you don't like the inspection or don't sign it.

    If they can't/won't pay for any repairs, they can't/won't. You can't make them. But if you word it the right way, you will at least be able to walk away w/o losing your deposit.

    Can you post what it says now?

    Who is "the attorney?" Your attorney or the the seller's attorney?

  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    I stand by what I say.
    It's not easy being a princess, but hey, if the crown fits.
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    violets if you are nervous about it, back out. This is what I love about the people around me. I know I won't be steered wrong. Good Luck!
    It's not easy being a princess, but hey, if the crown fits.
  • violetsviolets Posts: 1,689Registered Users
    violets wrote: »
    I spoke to the attorney and she said "as is" does not mean they can't make any modifications. She said that what you see is what you get. I still can ask them to pay what comes out of inspection.
    I am very nervous about the whole thing. I did voice my concerns to the attorney. She assured me it is standard language.

    Make sure it says what you need it to say about being able to void the contract if you don't like the inspection or don't sign it.

    If they can't/won't pay for any repairs, they can't/won't. You can't make them. But if you word it the right way, you will at least be able to walk away w/o losing your deposit.

    Can you post what it says now?

    Who is "the attorney?" Your attorney or the the seller's attorney?


    The original offer contract talks about the inspection contingency. It says any structural, environmental, and a list of appliances. Then it says the buyer must inspect, present the inspection results to the seller, which the seller must remediate or the "BUYER MAY CANCEL THE CONTRACT" . That is fine.

    In attorney review , the sellers added:
    a. "Property is "sold as is" with no warranties or representations of any kind except as specifically set forth in the contract". "All other representations and warranties are expressly disclaimed".

    B." In the event of loss or damage to the property exceeding 10% of the purchase price either the buyer or the seller may cancel the contract".

    c. "Any conflicts, then the letter shall control." Meaning the later rules.

    When I asked MY attorney about A, she said "as is" only means what you see is what you get.
    When I asked her about B, she said that only means its a clause for the insurance company to make repairs if I still want to go forward with the buying after such loss.

    I asked her how does this contract protect me? She said it protects me from environmental, structural, and anything that doesn't work in the house.

    I still say, how can that be the case, when letter A above is in the contract!
    I didn't sign the addendum yet.

    I sent her an email and she said we will talk on Monday. The problem is that we already talked but I am not satisfied!
  • LuuuuucyLuuuuucy Posts: 146Registered Users
    I think what that means is that you can walk away with your deposit if you find the inspection to be unsatisfactory. The sellers aren't fixing anything, and that's their right. But you are protected by having the option to walk away if something comes up that you aren't willing to accept.
    Curly work in progress
    2C with some 3A if all the stars align
    Low porosity, medium to low density and fine
    No sulfates since 2009
    CG since 2013

    In my stash:
    Shampoos and conditioners- Tresemme Naturals Low Poo, Tresemme Naturals Moisturizing Aloe, Suave Naturals Coconut
    Leave Ins- Kinky Curly Knot Today
    Stylers- KCCC, AG Recoil, KY Lubricant (yup), SM Curl Milk
    Gels- Ecostyler, Biosilk RHG
    Mousse- Devacurl Uplifting Foam, Suave Captivating Curls
  • cailincailin Posts: 898Registered Users Curl Dabbler
    Luuuuucy wrote: »
    I think what that means is that you can walk away with your deposit if you find the inspection to be unsatisfactory. The sellers aren't fixing anything, and that's their right. But you are protected by having the option to walk away if something comes up that you aren't willing to accept.



    Agreed.


    I think B means, if there is a fire or something between the purchase agreement and the closing. When I bought my house we had the spring flood of 2010. Many homes in the area were underwater. I could have walked away if I wanted to.


    Please ask your attny tomorrow what right a seller has to stipulate the amount of earnest money. I still don't get that and it would make me nervous.
  • CurlyInTheFogCurlyInTheFog Posts: 876Registered Users
    Here earnest money isn't really a percentage, but usually anywhere from $1000-5000 (probably more on million+ properties). Our last purchase was $5000. If you look at it from the seller's standpoint, a higher earnest money deposit means a more serious buyer. People do walk away from contracts and forego the deposit, but it's easier to do with a smaller deposit. Here selling "as is" doesn't excuse the seller from disclosing all known defects, but may mean that they won't be willing to negotiate much on repairs. What kind of contingencies did you put in your accepted offer?
    3a/b, F, normal porosity

    Suave conditioner, LAL gel
  • violetsviolets Posts: 1,689Registered Users
    Here earnest money isn't really a percentage, but usually anywhere from $1000-5000 (probably more on million+ properties). Our last purchase was $5000. If you look at it from the seller's standpoint, a higher earnest money deposit means a more serious buyer. People do walk away from contracts and forego the deposit, but it's easier to do with a smaller deposit. Here selling "as is" doesn't excuse the seller from disclosing all known defects, but may mean that they won't be willing to negotiate much on repairs. What kind of contingencies did you put in your accepted offer?

    I have the mortgage contingency and the inspection contingency.

    I just walked away from another house 3 weeks ago and now Weichert, not the buyer, is keeping the deposit. I want to apply the deposit to this house but weichert isn't letting me. That deposit was much smaller, only $1000.
    The agent wrote the contract, he put in the 10%. I guess they are trying to make it difficult for me to walk away this second time. The buyers already saw the amount so they don't want to change it to 5% now. I get that. I agree with I don't have the right people by my side.
    Thank you all for your responses.
  • spiderlashes5000spiderlashes5000 Posts: 17,495Registered Users Curl Neophyte
    violets wrote: »
    Here earnest money isn't really a percentage, but usually anywhere from $1000-5000 (probably more on million+ properties). Our last purchase was $5000. If you look at it from the seller's standpoint, a higher earnest money deposit means a more serious buyer. People do walk away from contracts and forego the deposit, but it's easier to do with a smaller deposit. Here selling "as is" doesn't excuse the seller from disclosing all known defects, but may mean that they won't be willing to negotiate much on repairs. What kind of contingencies did you put in your accepted offer?

    I have the mortgage contingency and the inspection contingency.

    I just walked away from another house 3 weeks ago and now Weichert, not the buyer, is keeping the deposit. I want to apply the deposit to this house but weichert isn't letting me. That deposit was much smaller, only $1000.
    The agent wrote the contract, he put in the 10%. I guess they are trying to make it difficult for me to walk away this second time. The buyers already saw the amount so they don't want to change it to 5% now. I get that. I agree with I don't have the right people by my side.
    Thank you all for your responses.

    Who is "the agent?" Your agent or the sellers' agent? Plz tell me it wasn't your agent who offered up 10%!

    You should write something into the contract that you have an out for inspection, an out for financing and an out for any reason by a certain date or you can void the contact and get your money back. No way would would I escrow 10% of ay purchase price unless the language was written strongly in my favor.

  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    Buyers would be better served, they say, by a thorough property inspection and an extended home warranty.

    Seller disclosure forms leave your house wide open to buyers

    I'm not really a fan of the extended home warranty; however, I have good people around me who help with this decision. Good luck!
    It's not easy being a princess, but hey, if the crown fits.
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    It's not easy being a princess, but hey, if the crown fits.
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    Here earnest money isn't really a percentage, but usually anywhere from $1000-5000 (probably more on million+ properties). Our last purchase was $5000. If you look at it from the seller's standpoint, a higher earnest money deposit means a more serious buyer. People do walk away from contracts and forego the deposit, but it's easier to do with a smaller deposit. Here selling "as is" doesn't excuse the seller from disclosing all known defects, but may mean that they won't be willing to negotiate much on repairs. What kind of contingencies did you put in your accepted offer?
    I was in this situation at one point about HardiePlank. It was at a time when it was the best thing since sliced bread, but proved otherwise.
    The 'realtor' who was representing the buyer was like a shady attorney.
    We did end up negotiating and still did very well. But to this day, I have a bad taste in my mouth. Never again.
    Good luck and know that if you pass this 'perfect' place up another one will surface.
    It's not easy being a princess, but hey, if the crown fits.
  • CurlyInTheFogCurlyInTheFog Posts: 876Registered Users
    A lot of what you can and can't reasonably do depends on location. CA is often a seller's market and buyers don't have a lot of leeway in what they can demand. We bought this house in 2004, which was a hot seller's market but not peak. We couldn't even put in the contingency of selling our other house--I mean, we could have, but we'd never have gotten an accepted offer from anyone. So we left it out and sweated for three weeks until our house sold. Our next house will probably be in another state and cheaper, so we will hopefully be able to buy with cash (retirement). I can't wait to be the one finally holding all the cards.

    And CA is one of those states where you have to disclose everything. The stack of forms to be signed at closing is ridiculous.
    3a/b, F, normal porosity

    Suave conditioner, LAL gel
  • curlyprincess1curlyprincess1 Posts: 468Registered Users
    Overall, it is to the seller's advantage. However, I tend to agree with you CITF. Viotlets just lean on your real estate agent. Isn't that their job?
    I wish you the best.
    It's not easy being a princess, but hey, if the crown fits.