Earnest Money

Good Faith money to show Purchaser is committed to the purchase, usually $500-$1000 depending on purchase price, amount determined between Buyer and Seller. Bank owned properties (Foreclosures-REO) are now requiring $1000 minimum earnest money. Earnest money checks are deposited in Broker Trust Account and either credited to Buyer on HUD-1 Settlement Statement at closing or refunded to Buyer at closing provided Buyer fulfills contract.


Homeowner Insurance

First year premium paid by Buyer prior to or at closing using Seller paid closing cost credit. Buyer is fully responsible for securing home insurance prior to closing.


Optional Home & Termite Inspections

Paid by Buyer at time of inspection. Inspection time frame is normally 7-10 days after contract acceptance. Inspections typically run about $400-500 depending on whom you choose. This fee should include a termite. Radon, septic & other specialty types will be additional.


Down Payment

Based on contract purchase price FHA-3.5%, Conventional loan-5%, VA-0% for Qualified Veterans-need your DD214, Certificate of Eligibility or letter from Commanding Officer if you are on Active Duty.


Closing Costs & Prepaid Expenses

 Can run from $ 2500-$4500 depending on lender and what types of things Buyer wishes to include, such as rate buy down etc. Buyer can ask seller to pay all closing costs and Seller will calculate this into their net proceeds.


Closing Dates

FHA 30-45 days to close, Conventional 30 days to close, VA 30-45 days to close, USDA RD 45-60 days to close. Depends much on appraisals and flex in market conditions. If there is a grant involved, it can be 45+ days.


Key Points

  • House is not sold and “in contract” until all parties have signed with initials and in agreement on all aspects of the transaction.
  • Home inspections must occur within the time frame specified on accepted offer.
  • Earnest money will not go to listing agent broker office until all parties have signed accepted offer. Earnest money will be deposit in Trust Account and held until closing.
  • All paperwork required by Lender and Realtor must be completed by Buyer in a timely manner to ensure an on time closing as this market is becoming very busy.
  • Buyer must make all investigations on anything exterior to the subject property. Realtor cannot determine any neighborhood stats regarding crime, sex offenders, schools, or any other outside issues. This must all happen within inspection time frame to make determination on decision to proceed on purchase. Recommend calling local officials for any information on crime, schools, etc
  • Buyer may choose any home inspector they wish.
  • Bank foreclosures may not turn on utilities.
  • Short sales can take 6 months or longer and Bank may not accept the short sale.


This is a great time to buy. Housing prices and have come down and interest rates are at an all- time low! I appreciate your business and will make this a smooth process.