We want to separate I want to know should I accept this and go ahead with agreement.
The money wil be handle by the lawyer to pay my rent. Can the owner freeze it at some point?
This is his lawyer who will be dispensing the money to my landlord.
Is this guaranteed I mean what if the account is frozen, or dispense money stops.
It really doesn't matter who holds the escrow because it can not be released until all parties agree to it. It is easier if the Buyers attorney holds it because they are the one that writes the checks at the closing.
As explained below the earnest money (typically $1000) is given when you write up the sales contract with your agent. The $1000 check is made out to your agent's broker and deposited into the broker's account ONLY if a contract is agreed to and signed by all parties, attorney review will then begin. If you write up the contract and the seller never agrees to or signs it -- your original check is returned to you. Now the initial earnest money (deposit) and can either be held in the brokers account until closing or in attorney review, the attorneys may change it to be held in one of the attorneys accounts (usually the seller's but I have seen the buyer's attorney hold the money as well). If that's the case, the broker will turn the money over to whichever attorney is specified in the changes of the contract. The second deposit (typically due 10 days after attorney review concludes) can be handled the same way...either your broker will hold it until closing or one of the attorneys holds it (that too is subject to the attorneys' changes during attorney review).
Should the check be deposited by the broker but the contract falls through during the attorney review period, a check will be issued back to you for the $1,000.
Hope that helps.
If you are not working with an agent but looking to buy in the Livingston area, I work out of the Livingston office and would be happy to help you with your home purchase or with any questions you may have.
Gina Chirico, Sales Associate
Prudential NJ Properties
973-992-6363 ext 116 office
Our standard contracts are written showing the Selling agent's company as holding the deposit (earnest) money initially. We generally ask for $1000 to get the offer started, but that amount can be higher if the purchase price is in the higher range.
Once the contracts are signed, and the 3 day attorney review begins, the attorneys may change that, and have (usually) the seller's attorney hold the money instead. It can vary, but at that point, it is decided by the attorneys.
If I am holding the initial $1000, once I receive the attorney letters, I will then have that money released and transferred to the appropriate attorney's trust account. The balance of the deposit money (often 10%) will then be sent directly to that attorney, unless, of course, the selling agency is still repsonsible for holding it.
Prudential NJ Properties
First, there is no hard and fast rule or regulation or law about who holds the escrow except as applies to the rules of a legitimate escrow account.
You as a buyer may find that a seller insists that the escrow be held by the seller's attorney or possibly the seller's broker. Often the intial good faith deposit will be in the buyer's broker's esrow account until the contract is finalized. Then it may be requested that it be transferred to the seller's attroney escrow account. Then any further deposits/downpayments will be made to that account. Since the earnest money ultimately is intended to transfer to the seller, having the seller's attorney hold the deposits is quite common.
There could be certain circumstances in which you, as the buyer, may wish to have your attorney hold a deposit perhaps and you should discuss this with your attorney before you make an offer to purchase.
I hope this helps you. Shouls you have any additional questions about the buying process in NJ please feel free to contact me at George@GWalsh.com. Good luck!
The earnest money can be held actually by anyone that Buyer and Seller agree upon. In a normal real estate transaction it is held in your real estate agents broker escrow account. However, real estate companies are not required to hold an escrow account. Therefore you may want to place it with your attorney or title company if you are not using an attorney.
I hope this helps you.
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