Home Buying in Vermont>Question Details

Deborah, Home Buyer in Virginia

What is the standard earnest money deposit on a real estate purchase in Vermont?

Asked by Deborah, Virginia Wed Aug 1, 2007

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In my experience, there isn't a standard deposit. It really depends on your situation.

I personally work as a Buyer's Agent as much as possible and in those situations, I like to minimize my client's exposure as much as possible. It doesn't matter if you have a few hundred to put down or are paying cash for a million dollar home, the deposit has the same purpose... it is to tell the Seller that you are serious about the deal and will not just leave the money and walk away from the deal... I like to call it a "warm fuzzy" for the Seller.

For the purpose of the offer, a large deposit can help to strengthen an offer with a lot of contingencies or concessions being requested of the Seller.

From my point of view, it is about striking the balance between promoting your offer as being strong enough to go the distance and not exposing too much of your money in case something catastrophic happens and you lose your deposit.
Web Reference: http://www.JimVTRE.com
0 votes Thank Flag Link Tue Apr 29, 2008
Earnest Money Deposits canbe in any amount - if you are buying asecond home or in a resort area, most likely the seller would expect a 10% contract deposit. If you are an first home buyer with little to put down or are a seller with all your equity/funds tied up in your present home, a deposit of $1000-$5000 make be considered enough. Sellers of properties over $250,000-300,000 usually expect that the deposit be at least $10,000 to 10% of contract price. You can offer an initial deposit of $1,000 and the balance of a higher amount up to 10% once contract contingencies such as home inspection are completed and satisfactory to you. The long and the short of it is that it is your offer, so offer what you believe is correct, as the seller can always counteroffer to you that they want a higher deposit. If you need any other advice, please contact me at dcanney@greenmtnrealty.com.
0 votes Thank Flag Link Tue Apr 1, 2008
Depending on the area you're looking in and the price range of the property, it could be anywhere from $500 to $5,000 that would be the minimum expected.
If you haven't already found someone to assist you with your homebuying process, please give me a call.
Allyson Nadeau
Coldwell Banker Choice Properties
abnadeau@gmail.com
0 votes Thank Flag Link Sat Aug 25, 2007
Deborah,
I am not familiar with your exact market... In general, the larger the earnest money deposit, the more seriously your offer will be considered. This can be especially important if your contract has contingency clauses because it makes the offer more attractive. If you have $10,000 set aside for your down payment, why not put half of that down with the contract to show the sellers how serious you are? When there are multiple offers, sometimes a larger deposit will generate a "yes" to a contract with a lower offering price. Your earnest money deposit is refundable if things don't work out... In any case, please be sure to use a buyer's agent to help you find a home and guide you through the process. Best of luck and happy hunting!
0 votes Thank Flag Link Wed Aug 1, 2007
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