Complete newbie here…
If I need to back out of a deal, under what circumstances will I not get my earnest money back? And besides “as little as possible” what is an appropriate amount ?
Thank you.
unless it you have the correct verbage in your offer or purchase agreement you do not get the deposit back.
you should include " contingent upon final inspection" then if for ANY reason you are not happy—you can back out and get your deposit.
you should also include " contingent upon finacing that satisfies buyer"
this should protect you.
as for the amount…thats usually up to you. I would say anything under $100,000.—$500. should be enough , $1,000. for anything under $500,000. and anything over 5k, 2-5k.
Usually its a personal preferance but sometimes you’ll see it in the sellers work sheet, still its up to the person making the offer.
hope this helps,
wendy
thank you for replying.
Yep. Those sure do protect the buyer. Then if you bail out of the contract how do you explain your actions to the desperate and/or unsophisticated seller? Only a desperate or unsophisticated seller would accept those weasel clauses.
Why not use honest, upfront financing and inspection contingencies and then act in good faith? What is wrong with forfeiting earnest money if you “back out of a deal”?