What do I need for deposit money?
This question is typically asked by first-time homebuyers as well as buyers who have something to sell. The first thing I can say about the deposit money is to arrange to have it now, so it will be ready when you need it, particularly if your money is tied up in your current home. Even if you are expecting 100 percent financing, it is unlikely that a seller will accept your offer without a “good faith deposit” or earnest monies. Traditionally, 5% of the purchase price is given as a remaining deposit on the home at the time that you sign your purchase and sale (minus your good faith deposit); however, some towns have a norm of 10% of the purchase price. If you need to take a home equity loan out the bank will not give you a home equity loan if you house is on the market. You must get a home equity loan before the sign is in the ground or your property is listed in MLS.
Your Neighborhood Realtor