Last week I mentioned “earnest money” as one of the expenses that you should plan on when saving money to buy a house. Here is a little more information on earnest money.
When you make an offer on a home you are asked to give about 1% - 2% of the offer in cash right away. This cash is called earnest money and shows that you really are serious about buying the house. Before signing a contract for the house, make sure the contract includes wording that will let you get your earnest money back if something happens and the sale falls through. Remember:
- Always read the contract your real estate agent gives you very carefully
- You can often a change a contract before it is signed- but not after
- Do not sign anything you are not comfortable with. If you have questions, ask your real estate agent before you sign.
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