Profile picture for NewOrleansDeb

Does the earnest money go to me for moving expenses? Or does all the money come to me after closing.

I don't have $5k in the bank to move but expect an offer within days of putting it up on the market. The builder for the new place can close within days of me sellingm my property, but I'm concerned that I won't have the money to move out of state and live in limbo for a week. Can I get the earnest money after inspection?
  • October 10 2009 - French Quarter
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Answers (10)

Profile picture for NewOrleansDeb
I live in the historic French Quarter - and will be about the only condo in my price range. I have a real etate agent who specializes in historic properties, and I will take his advice regarding price and anything else he advises. 
  • October 28 2009
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Profile picture for Deanne_OR

I'm a seller, too. I have a buyer who doesn't want to close until January. Because of the delayed closing date, I was worried that he wasn't really committed to follow through to closing. To give me some extra reassurance, I asked that it be written into the contract that his earnest money be released to me after the inspection and appraisal process is completed.

Although I'll have the cash in hand at that point, I'm not going to touch it until after closing. So it can be done, just be careful. There's no way to tell what might go wrong. I know something could still come up that will require that I return the money.

Why do you assume  you'll have an offer within days of putting it on the market? What's your secret?

  • October 28 2009
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Profile picture for nealadler
Typically the deposit goes to the seller with the net proceeds.  However, it is possible for the buyer to release the deposit to the seller.  This is negotiable between the buyer and the seller.  Check with your agent and or an attorney.  By the way a note to caveat emptor I'd be very careful on who you call an idiot.
  • October 27 2009
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Profile picture for Mr Caveat
be careful, nealadler might be an idiot for ignoring your question, but contingencies are a valid concern... if the buyer fails to purchase and exercises a valid contractual clause, he is entitled to his deposit back. hold off on actually moving out untill the last possible moment.

also, some banks/lenders/agencies will offer to credit you for some moving expenses. i know USAA has a program where if you buy and sell with one of their preapproved agents, you get up to 3100 bucks. if it only costs you 500 to move, you can spend the difference on whatever you want.

if you aren't military(most families i think can play 6 degrees of separation for military status though) i'm sure this is not the only bank that offers the program.

down side is that you came here in the 11th hour. you have already found an agent and a buyer so this wont help you much.
  • October 12 2009
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Profile picture for NewOrleansDeb
I just might be able to do that. I am showing my house today to an acquaintence who has been looking. I thought about getting a loan to do this, but the loan companies want me to borrow $50,000.

I would take the cash once all the contingencies are removed - a few days before closing, move, then close then put my money into my new place. It's a 200 year old building - kind of an as is - cash ony situation.
  • October 12 2009
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Profile picture for JLM7
Dear NoDeb.

I am going to make an assumption and assume you are talking about The Deposit.

A real estate transaction is governed by anything the buyer and seller agree on. Really the only requirement is that it be in writing. So get take your purchaser out for a drink and write your purchase agreement on the cocktail napkins if it makes you 2 happy. 

The deposit is controlled by you agreement. And can be a simple as buyer hereby  delivers to seller 5K and seller hereby acknowledges receipt. Or you can get into the non interest bearing escrow account huey.



 Use a Crayon if you like just put what you agree on in writing
  • October 11 2009
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nealadler, you didn't even read the question.
  • October 11 2009
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Profile picture for nealadler
It depends on the contract.  Typically contracts would have contingency periods.  Additionally, it also depends if contingency removals are active or passive, meaning active removal means the buyer sends a document saying they are removing their contigencies; inspection, loan, appraisal, preliminary title report, etc.  A passive contingency means the contingencies are removed by a date certain unless the buyer specifically requests an extension.  If all contingencies are removed the deposit may be at risk.  Best thing to do is have an attorney review the contract.
  • October 10 2009
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Profile picture for kittenonkeys
First of all, with the mandatory Louisiana contract, the deposit is not considered earnest money.  It is just a deposit, and the rules for dispersal are very clear cut according to the Louisiana Real Estate Commission and the contract itself.

Secondly, the deposit is returned to the buyer at the closing table.  It can then be applied to down payment, closing costs, or retained by the buyer if all other expenses have been paid.  Remember, a closing is not done until fully funded.  A contract can still fall through after inspections for failure to appraise, buyer's inability to obtain financing, etc., all again fully spelled out in the contract.

Read your contract very carefully.  It is legally binding.

Hope this helps you understand the process a little better.
  • October 10 2009
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No.

The earnest money is held in escrow by the company that is listing your home for sale.

Because there is no guarantee a property will close until it actually closes, you won't have access to earnest money.

You might be able to find a mover who would be willing to be paid once you close on the home.
  • October 10 2009
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