Escrow deposits are a very important part of what we do. It shows you are serious about buying the property. My opinion is if you are not willing to put a deposit down then how serious are you? Plus we live in a sellers market (Actually, I suspect SWFL will never be a buyers market again)
As an investor I always submit offers with the verbiage of escrow to be made within 24 hours of acceptance, This is a time saver, A lot of times you will have to shoot off an offer quick and may not have time to run an escrow check around town.
Here are some things I have learned about escrow deposits
- Always have your title company hold your escrow. Even if they are not doing the title work. If they will not do this then they have no business being your title company. If there is a dispute, then it is a civil matter making the escrow deposit harder to claim. Under no circumstances should you allow the listing agents company to hold escrow. Why? The listing agent gets 50% of the deposit, how objective will he or she be when they can put some money in the bank.
- Do not agree to make escrow money non-refundable unless you can lose it, Deals sometimes die in the 11th hour, I have donated $500.00 to HUD due to missing a closing date, the situation was almost an act of god but, sometimes real estate can be like Vegas, you pay your money and you take your chances.
- Always bring certified funds, Keep a copy of it coming from your account and a copy of the check with a receipt from your title company.
- Use escrow deposits as a bargaining tool, the same offer that has a $5,000.00 escrow deposit, as opposed to the one with $500.00 should win every time, minus other factors, Such as if the other offer is an in-house deal or even worse the listing agents client. Then all bets are off. Sad but true.
- Know your dates on your contract, Make sure you know your inspections dates and the date for your financing contingency. Once these pass you lose a lot of ground to get your money back if the deal goes south.
- Once the deal dies get aggressive about your money, I have just seen a deal where the lender killed the deal and a discounted listing agent showed pure and simple apathy against getting these people their money back to the point of lying about sending the release of escrow to the seller. I am trying to figure out whether this is apathy, laziness or malice in the heart of this real estate agent but that will be another article.
SWFL REIA, Founding VP
239 671 8248