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[quote=Anonymous][quote=Anonymous]

This still makes no sense to me. What's the difference between writing a check and saying you have the money for a down payment? Neither is no more proof that you actually have the money than the other.[/quote]

It's been awhile since I purchased a house but I was under the impression the earnest money was actually deposited in an account that was overseen by a 3rd party and if the deal falls thru both the buyer and seller have to sign off for the buyer to get the money back. I think my realtor gave me a receipt of some sort of the deposit when my contract was accepted for this house.

To me there is a difference between the buyer putting X amount in a bank account that I as the seller may be entitled to if the deal goes south for certain reasons, that will be a pain for the buyer to get back if the deal goes south, that could have minor cancellation fees that the buyer pays should the deal not happen, that the buyer can afford to live without while we are waiting to get to closing versus telling me they will have x amount that they will bring to the table in 30 days and a letter from a bank that says they can afford it.  As people say, money talks and bs walks.  Think about anything you sign up for when you have to put down a substantial deposit ..it make you think twice, am I sure I'm going to go thru with it, can I afford paying that deposit money now, can I afford and am willing to risk possibly losing that money or possibly a portion of that money etc.  it really commits you more to whatever you signed up for.

So yes, earnest money is important to me as a seller.  As far as the downpayment amount, as a seller, I am taking someone else's word that the money really exists but my thought is someone with a bigger downpayment will have less risk of the financing falling thru at the last minute and will have room to compromise with things found in the inspection or the appraisal.  Everyone of course wants to negotiate the best deal but if you can just afford the house barely, finding out the roof likely need to be replaced in 2 years might cause you to walk away or argue for me as the seller to do more because you cannot afford the house otherwise.

http://www.realestateabc.com/insights/deposit.htm

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