No matter how much time you spend on researching and educating yourself about your home purchase, it’s hard to cover every detail. Here are a few tips for avoiding rookie mistakes with your first home purchase. Earnest money is a deposit you pay when you make an offer on a home—it’s a way to show the seller that you mean business. Usually you can’t get it back, but there are several circumstances that allow you to recover your earnest money.
Appraisal contingency: With an appraisal contingency, you can recover your earnest money if the home is appraised for less than your offer. This gives you a better negotiating position—if the seller doesn’t agree to a lower price, you can get your earnest money back and walk away from the deal.
Major problems with the home: It may be your dream home at the surface level, but an inspection could reveal major, major problems—such as issues with the foundation, or flood damage. In that case, you can get your money back if the seller doesn’t agree to a lower price.
The seller backs out: Obviously, if the seller changes their mind about the transaction—maybe they decide not to sell, or accept a higher offer—you get your earnest money back.
Your house hasn’t sold: Many buyers can’t afford a new home if they’re still financially responsible for their old one. In this case, you can work a sale contingency into the contract, and get your earnest money back if the home doesn’t sell soon enough.
Financing issues: Though there are some limits on financing contingencies, you can get your money back if you’re unable to get a loan.
Author:Lynda Western Phone: 602-919-0857 Dated: September 6th 2016 Views: 258 About Lynda: A family oriented person, Lynda has a passion for helping people in unfortunate situations. An Ariz...
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The partners of Re/Max Preferred Choice specialize in both the purchase and sale of residential and commercial real estate, as well as providing property management services. We have been in business since 1996 and have a long history of providing exceptional customer service to our agents.
One of the first decisions that must be made in the home buying p
"We met Justin Schlegel a few years ago and liked him from the start. We called him to sell our house and he exceeded our expectations by doing so in 2-days! Justin's knowledge about the current housing market and even the construction aspect are second to none. Then, in August of 2015 we used Justin to purchase our new home. Justin again did not disappoint. Justin's knowledge of the area is impressive. I never had to wait to have a question answered as I think Justin has his phone with him 24/7 :). I highly recommend Justin Schlegel to anyone looking to buy or sell a home. Thanks again Justin!
Chad & Janice in Peoria, on behalf of Justin Schlegel