Judi, Home Buyer in Maine/Florida

We are making a cash offer on a property in ft myers beach - under $300k- we are paying cash- the broker

Asked by Judi, Maine/Florida Fri Jun 6, 2008

wants us to put 5 -10% down- this home has been on the market for close to a year and price reduced a coupld of times. Is this typical of southwest florida- we are used to making an offer with only 1 to 3% earnest money- feel uncomfortable with such a large ammount in earnest monoey!

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Answers

6
If you are making a "low-ball" offer, the broker is trying to "strengthen" the low offer by showing a strong earnest money deposit to the seller. It is less likely you would walk away from the contract than if you only gave 1 to 3 percent of the earnest money. If you are really serious about the property, you shouldn't have any heartburn about the larger deposit.
1 vote Thank Flag Link Wed Jun 11, 2008
Hi Judi, You should NOT have to put anything down, but to show proof that you do have the CASH to purchase the property at the contract price. I work with many individuals and entities who pay cash and there are certain guidelines that we follow so that you the buyer is not inconvenienced when paying in cash. We are very use to buyers paying in cash in the SW Florida and Naples, Florida area. We apologize for the inexperienced agent that you are working with on this purchase. If I maybe of help further, please let me know. Good luck!! Thanks, Mary
0 votes Thank Flag Link Mon Jun 9, 2008
Hi Judi,
I think each transaction is different with its own set of circumstances. I have represented buyers just recently with cash deals and they put 5% down. They wanted the homes and wanted to present strong offers. I have also had buyers with 1% or 2%. I usually suggest for larger escrow amounts, that they put an initial deposit and after the inspection period put the additional escrow; to equal that 5% or more. You should look at your offer as a whole, and if others may be writing offers on that home as well. Always do what you’re comfortable with and discuss your concerns with your broker. I wish you the best of luck.
Have a great day,
Nancy
0 votes Thank Flag Link Fri Jun 6, 2008
A compromise might be to initially put down a nominal amount and after your inspection period is over come with an additional deposit.
Web Reference: http://wesellswfla.com
0 votes Thank Flag Link Fri Jun 6, 2008
It sounds like you are using the sellers Realtor. There is no typical earnest money amount. If you feel comfortable with 3%, then only give 3%. This isn't to say that you can't give the 5% or even the 10%, as the sellers are looking for a "sure thing" and the more you give upfront, the better it looks that you will close. To keep them happy, maybe offer the 3% and a proof of funds statement. It isn't that the sellers think you are not serious, but more likely they have had previous offers that the buyers backed out of at the last minute and they are trying to make it harder for you to back out at the last minute. Good luck.
0 votes Thank Flag Link Fri Jun 6, 2008
That does seem like an astounding amount. I would ask the broker why they are wanting so much. Are there other circumstances such as an extended closing date or other issues you are not telling us. In our market that would be an unusual request. Get the reason and go from there.
Web Reference: http://www.MykeTriebold.com
0 votes Thank Flag Link Fri Jun 6, 2008
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