Earnest money deposit

[Anonymous]

In process of buying house in 800k range. We put down 8k earnest money and didn't have any issues. Of course, we also have $400k in equity that will go toward the house at closing. I didn't want to put more down in earnest, since we are using available cash to do last-minute inspection-related items on current home, need for movers, etc. I don't want to be flat broke when we move into the new place.

[Anonymous]

I always thought the norm was 3%. This is the first I'm hearing of 6%! We are planning to move to MD soon and were going with the assumption of 3%. I agree that even if you have money in your current house, if you don't have 50K (even temporarily to put back into savings after the sale of your house) that a house of this price isn't for you. In addition to having a cushion in case of job loss etc, new houses can come with unforseen problems and expenses. And don't forget the high closing costs on both properties.

Now if you have the money but it would wipe you out, and you know your house would sell, you just take a temporary risk of taking out all your money with the assumption you would put the same amount back into savings after the sale of your house.

[Anonymous]

We bought a house in Arlington in 2001 and then bought a house in MoCo in 2007. We used the same agent each time. The first time, we put up $5K earnest money for a $395k house. The other offer put up $15K, which shocked us, but luckily, we still got the house.

The second time, we bought a house for $1mm. We were stunned when our agent - the same one we had used before - told us that in Maryland, it is customary to put up 5%. What??!! But we did - we had taken out a line of credit against our (substantial) equity and we used that to come up with the $50K.

Don't bid on a house unless you really, really want it.

[Anonymous]

Anonymous wrote:In process of buying house in 800k range. We put down 8k earnest money and didn't have any issues. Of course, we also have $400k in equity that will go toward the house at closing. I didn't want to put more down in earnest, since we are using available cash to do last-minute inspection-related items on current home, need for movers, etc. I don't want to be flat broke when we move into the new place.

us too. we just put a contract down on a house at 1%, it was no problem. im shocked at these claims of 5-6%.