Home Buying in 33132>Question Details

Oscar, Home Buyer in 33027

Offer deposit procedure for oversees buyers

Asked by Oscar, 33027 Tue Sep 22, 2009

Dear forum members. A realtor with whom I have been in contact for the last 12 months is asking me to provide a couple of checks for a given amount with a blank “pay to the order to” field. The explanation given is that in order to snap a good deal, offers have to go out quickly with a deposit check included (the “pay to the order to” field will be filled in then). If we have to wait until the check arrives from oversees, we may loose the deal. Is this a normal practice? I really feel comfortable with the realtor (very well recommended by a friend of mine who lives in the US) but just want to check if this is a normal practice.
Thanks for your advice.

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Answers

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Bottom line: find a local attorney to act on your behalf. Never give anyone money for anything that you're not in control of. On top of that, Florida law requires that any deposits made for real estate escrow deals must be turned in to the broker within 1 business day of receipt; giving a blank check violates that rule. Also, you are depending on a person with no fiduciary responsibility to you whatsoever. Who says they cannot write the check to themselves? Who decides how much to write the check for.
There are plenty of experienced local attorneys who ARE in privity with you, and who can represent your interests, and work at your direction. It's the only way to operate.
Having said that, I will also point out the following: if you are going to purchase REO properties, most do not require a deposit until after the bank has accepted an offer; in that case, they usually require that the money come directly from the buyer; in most cases, they will accept the money from your attorney, if there is an engagement letter or some evidence that they are working on your behalf.
Web Reference: http://www.myriamsHomes.com
0 votes Thank Flag Link Tue Sep 22, 2009
Oscar, Wire the money to the closing agent or to a lawyer.
0 votes Thank Flag Link Tue Sep 22, 2009
Vivian - so you work as an Agent and not a transaction broker???
0 votes Thank Flag Link Tue Sep 22, 2009
Dear Vivian and Ron,
Thank you very much for your suggestions.
I do have an account with Bank of America. Will discuss the two options with my realtor.
(Ron, by the way, the suggested blank part of the check is the "payable to" field, not the amount)

Thanks again,
0 votes Thank Flag Link Tue Sep 22, 2009
Hi Oscar,

This is normal for you to write the check with a "pay to the order of" blank. If it makes you feel more comfortable, you can write "Escrow Company" in the blank. This is common practice, as the seller may be the one choosing the escrow company, in which you would not know what title company to write the check for. As for transactions overseas, the first response about wiring the funds may be a better idea.

A good faith check is the money you're willing to risk in order to give the seller an idea of how confident you are in your ability to get a loan. That's the best way I have explained it to my clients. Generally the higher the amout, the more you're willing to risk.
0 votes Thank Flag Link Tue Sep 22, 2009
Unfortunately, this happens more often that you would like. In Florida you can use an escrow holder such as a company such as mine. Allways make sure that is a reputable company that is licensed to be a title agency or broker.

The check should NEVER be made blank! In case of problems you would have little or no recourse. Remember that we go through all trouble in order to hold the escrow deposit in SAFE hands with a procedure in place that is fair and equitable to all.

Well recommended or not, well intended or not use an escrow company or a reputable Real Estate Company such as The Keyes Mortgage, Title and Real Estate.

No deal is worth loosing money. Sincerely,

(ER) Enrique R. Carrera
Real Estate Professional
ICQ#: 35081807
Cell Tel#: 954-478-3601
Work Tel#: 954-966-0631 ext. 228
Work Fax#: 954-678-0927
Website: http://www.ercarrera.com
Email: erc_realtor@bellsouth.net
More ways to contact me: http://wwp.icq.com/35081807
_________________________________________
0 votes Thank Flag Link Tue Sep 22, 2009
I work with International buyers & sellers and take seriously our fiduciary responsibility, which holds us liable for any losses incurred to a buyer's good faith deposit.

I feel that your best bet is to have funds accessible in a US Bank & then absorb the cost of a wire-transfer at the time of an offer, as this costs less than an international wire transfer & can be completed & verified within an hour!

I am not suggesting that this Realtor is not worthy of your trust, but why would he or she want to put themselves on the spot in the event something goes wrong?

As we say here in America, C Y A!
0 votes Thank Flag Link Tue Sep 22, 2009
Oscar, good question! The practice of taking a check with a blank amount is unheard of in our area. There are two ways you can handle this. Put an escrow deposit on account with your realtor. It can be a small amount say 1 to 2 thousand. Your offer contract can read "2,000" in escrow with an additional deposit of "whatever" upon exceptance. This can be done on foreclosures and short sales as well. You will not lose a deal. That is the way we handle escrow deporits.
Ron and Debbie Albert
Coldwell Banker Residential
0 votes Thank Flag Link Tue Sep 22, 2009
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