Home Buying in Setauket>Question Details

First Time B…, Home Buyer in Setauket, NY

How much money should be put down at contract on an offer of $465K? I'm serious about my offer, but nervous about escrow limbo if the deal

Asked by First Time Buyer, Setauket, NY Thu Feb 9, 2012

sours. We're on Long Island, NY and we've heard varying numbers from friends and relatives - from 1% to 10 % of the purchase price. We are serious about our offer, plan on putting more than 20% down at closing, have pre-approval and are flexible on the closing date. How much would you suggest putting down at contract in the current market? I've heard horror stories of the deal falling through and money being held in escrow because the buyer and seller can't agree on who should receive it. Also who holds the money until closing?

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First Time Buyer,
Your attorney should discuss how much is needed on contract. It is traditionally 10% if you are going for a conventional mortgage.
In NY the contract money is held in an escrow account by the sellers' attorney. Your contract specifically states the conditions on which the contract money is refundable. If you haven't hired a real estate attorney, do it immediately.
0 votes Thank Flag Link Fri Feb 10, 2012
The amount of money put into escrow is typically determined by the buyers and sellers attorney once the contact has been sent out. I would advise putting the least amount down at contract signing. The initial down payment should be made out to the sellers escrow account.

It is important to use a Real Estate attorney who specializes only in Real Estate to help protect your interests in this tranactions
1 vote Thank Flag Link Tue Oct 29, 2013
The amount is variable by area and custom:
Understand that it is also called "Earnest Money" or "Good Faith Money" and the more you put down, the stronger it looks to the Seller.
If you are putting 20% down, you will need to put even more than that in the Escrow before you're through.
If you think you will back out of the Deal, don't start it.
If you do a good job with the Contingencies you should be Okay.
If you can, put down as long a Contingency for the Loan as you can, anything can happen.
The Appraisal and Inspection Contingencies will protect you.
Let your Buyer's Agent guide you on how much.

Good luck and may God bless
0 votes Thank Flag Link Fri Feb 10, 2012
The least you can get away with 1st time buyer. In my area 3-5%is acceptable in most cases. The listing broker, Attorney, or Title company usually hold escrow money. Every State is different so please verify the rules that apply to this with reputable/qualified Realtors, Attorneys, or title companies.

Congratulations on purchasing and best of luck,

0 votes Thank Flag Link Fri Feb 10, 2012
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