How much money is required if a buyer wants to make an offer on a home?

Asked by Susan Nieto, Riverside, CA Thu Dec 1, 2011

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Lance King’s answer
Lance King, Agent, San Francisco, CA
Fri Dec 2, 2011

To put it simply:

1. Initial down payment (earnest money) is generally 3% of the purchase price, although offers are frequently accepted with a smaller down payment that gets increased after release of contingencies. This money is due upon acceptance of the contract.

2. Appraisal - generally on a single unit property around $450

3. Inspections - costs depend on what inspection(s) you do. In our area pest inspections are around $450 and contractor inspections are around $500

4. Closing costs - these include but are not limited to: title insurance, loan origination fees, title and escrow fees, pro-rated insurance, taxes, interest, HOA dues (if applicable), and miscellaneous notary and recording fees. This amount can vary dramatically depending upon loan fees and what the customary splits are between buyer and seller in your area.

5. Total down payment amount - the lowest is generally an FHA loan which requires 3.5%, so an additional .5% over your initial deposit would be required to close if you have this type of loan, plus closing costs.

If you want to get a more accurate number talk with your lender about a specific deal, and you can also call a title company to get estimates on splits.

Best Regards,

Lance King/Owner-Managing Broker
DRE# 01384425
1 vote
Harold Sharpe, Agent, LAKE HAVASU CITY, AZ
Tue Dec 20, 2011
HI Susan,
The elephant in the room,...
You just asked the 64,000 dollar question.
Everyone wants to know and no one really has a specific answer.
Susan you really need to talk with a local lender.
Where you buy is a factor in how much.
the price you qualify for is a factor.
the price of the home
the debt you have vs your qualified income.
If you have a regular w-2 job it may help.

Harold Sharpe - Broker
So Cal Homes Realty
(951) 821-8211
California Department of Real Estate Broker License # 01312992
0 votes
, ,
Fri Dec 9, 2011
I assume you are asking about Good faith funds. Even on a VA No No they put up a dollar. it is hard to open an escrow with no money in it.
0 votes
Cameron Novak, Agent, Corona, CA
Thu Dec 8, 2011
Hi Susan,

There are available programs with a full spectrum of down payment requirements... some offer financing for a full 103% of the purchase price (which typically will cover the loan PLUS the closing costs). Talk to a lender at The Homefinding Center or a reputable bank or credit union for more info on the available programs (note: banks and credit unions don't typically have many options).
0 votes
Diana Margala, Agent, Rancho Cucamonga, CA
Fri Dec 2, 2011

This question is a question that most buyers ask and the reason that it is best to talk to a lender before you start looking.

Understand that there are different financing programs out there that are unique to each buyer. The programs that will be available and the amount that is needed will be based on the buyers FICO Scores, Credit History, Debt Ratio, Available Funds, Employment proof and history, and finely if there are any city or lending programs that they may qualify for. That is why there is not one specific answer because all of those factors may make a difference.

Those items and the amount that you put down, will also affect the % of interest that you might be charged for the loan. Then there are the points that the lender may charge, escrow and title. Each loan program may have limits on what a seller can contribute towards your closing costs (then remember that is something that the seller may or may not participate in). The rule of thumb is 2.25% for costs plus the down payment amount that is required by the loan program you will be using.

Even if you are not ready to purchase right now, talking to a lender who can go over the lending process is always helpful and a great idea to do before you start looking. This gives you time to plan and figure out what will work for you and your family. The lender that a lot of my clients use is Ed his number is 909-481-7233. He takes time to explain what might be available to you.

Good luck and when it comes time to start looking give me a call.

Diana Margala 909-560-0145
Web Reference:
0 votes
Stephen McKee, Agent, Riverside, CA
Fri Dec 2, 2011
Lance nailed this one. To add to his answer: Closing costs run 4-6% of the purchase price. You can ask the seller to pay for these costs but it will effect your chances of getting your offer accepted.
0 votes
Lydia Kray, Agent, Corona, CA
Fri Dec 2, 2011
Hi Susan,

A deposit check of minimally $1000. on a house price of $100,000. As for total down payment,
FHA financing is the least money out of pocket which is 3.5% down payment of the purchase price.
A hardworking Realtor will be persistent to get your closing costs included in the purchase which is aprox.
3% down payment.
Any other questions please feel free to call or email me.

Lydia Kray- Corona/Eastvale Realtor
cell 951-733-1058
Web Reference:
0 votes
Garrigus Real…, Agent, Redlands, CA
Fri Dec 2, 2011
It all really depends on what kind of financing you're using and how much house you're buying. But consider this: If you buy a house priced at $100,000, and used FHA financing, you can expect to put down 3.5%, or $3,500. Plus closing and transaction costs at 6% of the purchase price, or $6,000. Combine the down and the closing costs and you're looking at about $10,000 to buy a $100,000 home. Keep in mind that this answer is completely generic and without any details, but it can give you a simple rule of thumb.
0 votes
Bill Eckler, Agent, Venice, FL
Fri Dec 2, 2011

Your question is a little vague and would benefit from additional specifics. If you are refering to an amount necessary to accompany an offer....from the buyer's perspective, a deposit should be large enough for the seller to view you as a "serious" buyer but not so large as to jeopardize a sizable amount of money should things take a difficult turn.

It is common for serious buyers to present two deposit of a lesser amount that accompanies the initial offer and a "secondary" often larger amount that is submitted at a designated time after the offer has been accepted.

I hope this addresses your concern and you find this information helpful.

Best wishes,

0 votes
Elise Timpe, Agent, Corona, CA
Thu Dec 1, 2011
First, you get pre approved for a loan. The lender will give you an estimate of these fees that you'll be paying right before it closes. There are several different kinds of loans, depending on your qualifications and the property.

Generally, there is the FHA loan that requires 3.5% downpayment or there is the conventional loan with 20% downpayment. There is also a VA loan called a VA no no which is zero down. However, there are constantly new loans coming on the market with various amounts of downpayment. A knowledgeable lender will be able to help you find the one that is right for you. This is an important first step because in this market, your pre-approval letter is requred to be submitted with your offer or they won't consider your offer.

Next, when you find the right home, you will need to include an "Earnest Money Deposit" (your "skin in the game"). This is generally 1-3% of the sales price. If you have competition and really want the house, it can be helpful to make it closer to a 3% EMD. It can make your offer seem more solid. The deposit is part of the overall downpayment. It is held uncashed until your offer is accepted. Escrow will deposit it into an account when they receive it; usually within 3 days of offer acceptance.

Once your offer is accepted,the contract allows you a period of time to get a home inspection and do any fact finding you'd like before making your final commitment (your inspection contingency). The home inspector will usually want you to give them a check at the time of the inspection ranging from around $200-$600, depending on the inspector, the house and the area.

After that, you just wait until everyone completes their job during escrow. Within the last few days, they'll "draw docs" (loan documents) and you'll be called in to bring the money you owe for downpayment and costs & sign the loan documents. They will let you know the exact figures when setting up this appointment. They should be close to the estimate the lender gave you up front.
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0 votes
, ,
Thu Dec 1, 2011
Are you referring to how much money is needed to show the seller you have for earnest deposit? Down payment? Or loan/escrow related closing costs?

Did you know you can buy with $0 down payment in Corona? Check it out in the web reference link below.
0 votes
Ameerah Bold…, Agent, Rancho Cucamonga, CA
Thu Dec 1, 2011
Good evening Susan, As a buyer you are not required to pay a cost to write an offer on a home. Upon an accepted offer you will be required to open Escrow with an Earnest Deposit , which generally varies from 1%-3% of the sales price. If you require financing on your home try to negotiate in your offer that the seller pays your buyers closing cost fees. I would be more than happy to assist you with your offer or home search. Feel free to call me or send me an email if you should have any further questions. My direct number is 909-957-4363 or email:
0 votes
Micki O'Toole, Other Pro, Corona, CA
Thu Dec 1, 2011
Hi Susan,
If you are going to write an offer you are usually asked to submit a copy of your earnest money deposit check along with that offer. This amount is as little as 1% of the offer amount or as much as you want to put into escrow should your offer be accepted. Typically just a copy of the check is needed and no money is actually given until an accepted offer has been received and you are opening escrow. Your agent should be able to advise you further regarding earnest money deposits.

All my best,
0 votes
JJ and Lovina…, Agent, Corona, CA
Thu Dec 1, 2011
Hi Susan, before we take our buyers out for house hunting, we already have the buyer preapproved for the home loan. Then we show our buyer all the available houses that fit their criteria. If our buyer wants to make an offer on a particular house, we show the buyer the comparables for that house. This way, our buyer would have an idea of the market value of the house thus arming the buyer with the necessary information on how much to offer for the property. When we write the purchase offer for our buyer, the buyer puts in a minimum of 1% of the purchase offer price as earnest money deposit. I hope this helps answer your question. Feel free to contact us for more detailed information free of charge at or you may call us at 714-883-2554 JJ or 714-883-2561 Lovina. Or you may visit our personal website or follow our tweets through our twitter account at!/JJLovina
0 votes
Craig Chasta…, Agent, Rancho Cucamonga, CA
Thu Dec 1, 2011

If the seller does not require a holding deposit (which most dont) then no money is exchanged to write up an offer. You do however need to be pre-qualified for a home loan.

If you have any further questions please feel free to call me.

Craig Chastain
Next Level Realty
0 votes
Dan Tabit, Agent, Issaquah, WA
Thu Dec 1, 2011
Step one is to meet with a lender and get pre-approved. There are some 0 down loans, but they have limitations and you or the property must meet certain qualifications.
You will want to have some money for earnest money and an inspection. Earnest money is negotiable, depending on what type of statement you want to make with your offer and what the seller requires. It can be as little as they will require or as much as makes sense to put at risk.
0 votes
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