Buying or Selling a Home/Earnest Deposit

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Expert: - 9/27/2009


Question
Hi Jessica, My husband and I are in the process of buying a home. We gave an Earnest Deposit of 1,000.00 Our sellers agreed to pay full cost of closing and we dont have to put any money down since its a VA loan. Now im being told I will not actually recieve the earnest deposit back at closing that they are applying that to the closing costs. Im confused because the agreement was that the sellers would pay all of the closing, why does my money have to be applied if that wasnt the agreement?

Answer
Dear
Eileen;
when you met with the lender did you get an estimate of closing costs?  Was there any cost that they would not allow the seller to pay?  Sometimes the lender will only let the sellers pay for non-recurring closing costs and then they withhold a certain amount (like 6 months worth) for your taxes or homeowners fees or insurance.  these are real costs that you must pay during the course of the year but by holding those in an account in insures the lender that you will not default on those payments and put your property in jeopardy of having a lien placed on it.  You can see why a lender would require this especially if they are financing 100%.  So...this may be where the closing costs could require additional funds from you.  Call your lender and get a clear definition before proceeding.

Best wishes,
Jessica Bryan

Buying or Selling a Home

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Jessica Bryan

Expertise

buying and selling process such as:
General questions from first time buyers
How to market a home
Why choose a REALTOR
How do I find a REALTOR
Should I consider buying or selling without a REALTOR--how much can I save
Should I remodel or move
How much can I expect to gain by fixing up my home before selling
Helpful tips when selling
Helpful tips when buying
finding a good mortgage loan
what is the difference between banks, mortgage bankers, and mortgage brokers
Questions from the general public, people thinking about getting their real estate license, newly licensed.
Fellow professionals who have interests in networking and how to get started
What is a market evaluation and how does it differ from an appraisal what are the different loan programs
services a REALTOR can perform
when to use a lawyer
when to use escrow
what are the regional differences in the buying and selling process
what is the MLS and how does it work
how can the layman access information on the web--listings and other information
These are just a few of the questions. I can suggest that if I am unable to answer a question I will refer the inquiry to a source that can.

Experience

Anyone who is in this business and who dedicates oneself to professionalism has continued to take classes and along with it,additional credentials, awards and honors. I can list a host of them, but my greatest accomplishments happen to be those of getting first time buyers (who didn't think they could afford to buy a home)into a home of their dreams. The look on their faces when I hand over the keys is worth all of the hard work.

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