PRE-PURCHASE, A TIME TO ANALYZE!
By Pierre Mouchette | Real Property Experts LLC
In general, there is no static sum of money for the Buyer to deposit for Earnest Money or Due Diligence. The amount of earnest money could be a percentage of the purchase price. Still, both the due diligence fee and earnest money deposit will be decided between the Buyer and Seller and written into the contract.
Your Earnest Money Deposit (EMD) amount is not written in stone except for banks and auctions that usually require 2 to 10-percent down. You can have a lower EMD by providing solid proof of funds letter, few contingencies, and a short due diligence period. Your EMD should be held by your attorney instead of the real estate broker or title company.
Clarification of Terms
Earnest Money Deposits (EMD) – this is good faith money. The Buyer is showing the Seller they are serious about purchasing the property. Characteristics of the EMD are: