For the first time homebuyer all of the aspects of the home buying process are new. One of the points that you need to understand is the earnest money deposit.
Earnest money is money put down by the purchaser when they make an offer on a home. You will need to set aside some money to have for the earnest money deposit when you make an offer on a home. The purpose of the earnest money deposit is to demonstrate the seriousness of the purchaser’s intentions to the seller. The amount is often between 1-5% of the purchase price, but this can vary with local customs. The more money that is put down the more serious the seller will feel that the buyer is. When the offer is accepted the earnest money deposit will become part of the downpayment or closing costs. If the offer is rejected the earnest money will be returned to the buyer. However if the purchaser defaults on the contract the earnest money may be forfeited.
If you are a first time homebuyer considering a purchase of a Charlottesville home, I would be happy to go over the home buying process with you. I would love to help you find the perfect home.
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Pam Dent