This is a cash deposit you make when submitting your written offer on a property to show your "good faith". Sellers are understandably suspicious of offers that are not accompanied by such deposit. Your Earnest Money is held by one of the brokers, the title company or an attorney. If your offer is accepted, these funds become part of your down payment at closing.If negotiation fail to result in a sales contract, your earnest money is usually refunded.
What are seller disclosures?
Most states and many local areas require sellers to disclose any known material defects. Lead- based paint disclosure is required in all states for properties build before 1978. Make sure that you read and understand these documents, because your recourse options will be limited once you sign any disclosure.
What if there are multiple offers?
If other buyers are interested in the same property, the seller may be comparing your offer to others.
Can you take back an offer?
In most cases the answer is yes, right up until the moment your offer is accepted. In some cases, you can withdraw an offer before you've been notified of its acceptance. If you want to withdraw your offer after acceptance, be sure to do so only after consulting a lawyer who is experienced in real estates matters. You want to avoid losing your Earnest Money deposit or a lawsuit for damages the sellers incurred because of your action.