A few weekends ago I was running an open house in West Hartford. The traffic was pretty steady and most people seemed to react positively to the home. About a half hour in, a buyer came up to me and asked me if they could give me money to hold the house for them.
Excuse me?
A deposit. They wondered if they could give me a deposit to hold the house for them. There seemed to be a lot of interest and if she gave me money, could I hold the house for them so no one else could buy it?
I asked the woman if she had an agent. She said she did. I said that if she liked the house that she should contact her agent and they would help her write an offer on the home. If they were able to come to an agreement with the seller, then we could take deposit money on the house. She said “You’re sure I can’t just give you a deposit right now?”
Yes, I was sure she couldn’t give me a deposit right then.
The “deposit” the woman was referring to is what the agent community calls earnest money or escrow funds. Once a buyer has an offer accepted by a seller and a contract is signed, there is some monetary amount that is provided with the signed contract. Real estate contracts in CT have to have “consideration,” essentially something of monetary value, that accompanies them in order to be legally binding. In most cases this is a monetary deposit of some amount. That deposit, usually, is then put in to the listing broker’s escrow account where it is held until closing or given to the buyer or seller if the transaction blows up along the way.
If you really like a house, work with your agent to write an offer and get it accepted by the seller. The listing agent can’t take your deposit money to hold a house for you, but will gladly take the funds and put them in the escrow account once a contract is signed.
Hi Amy,
tsk tsk…another buyer unencumbered by knowledge.
I wonder if the buyer’s agent is properly informing the buyer what to do when one is interested and intends to purchase “the” house. Otherwise, the buyer is not getting her $$$ worth by not being informed about the procedural steps to secure the house.
Was the woman younger or older? what happened afterwards? I’m curious…in general terms, no specifics please.
Hi Nick, in this case it seemed like the buyer’s agent hadn’t done much coaching, but I also didn’t have much visibility into how long the buyer had been searching. They did come through with their agent after the fact.