Profile picture for hsmith9891

Is there a required Offer Form that must be used? & Earnest Money Deposit Questions

I want to submit an offer on a home but I do not like the verbiage used in the California Residential Purchase Agreement and Joint Escrow Instructions form. Am I required to use this form or can I write up my own form, 80% similar to this form with a few exceptions? Are there other forms that are required?
Is it possible to use this form with attached written changes?

Earnest Money Deposit:
Is this required by law or is this a sales tool because people back out on the offer?
My issue with this: I will go through with buying the home, but if my lender or the seller do not get their act together in the time frame of XX days, I could lose my deposit. This is not fair.
Can I require that this deposit must be returned (in full) to me if the deal falls through due to any circumstances, as long as the seller signs this written agreement?
  • August 22 2014 - Simi Valley
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Answers (4)

Profile picture for wetdawgs
Earnest money puts the onus on your shoulders to chose a good lender and have solid pre-approval before moving forward with a purchase offer.   If you don't trust the lender, don't hire the lender.   This is like a work team, the lender is on your team and if the lender does not perform it reflects on you - the boss.  So, if you chose a poor team member and don't meet your goal you are still responsible.

It would be an extremely rare seller who would accept "earnest money, but not really" clause you wish to put in the contract.   I wouldn't even in a buyer's market. .  Shows you don't really wish to commit, i.e. aren't really earnest and wish to do it without risk to you but you do want the seller to shoulder the risk (by taking their house off the market).

  
  • August 22 2014
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Profile picture for hsmith9891
I do not lack commitment - these guys know I want this house Hell or high water; but I don't like the fact that I get screwed if my lender doesn't come through.  
  • August 22 2014
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You can write a contract any way you like but don't expect a seller to accept it. I'm pretty sure you have a sellers' market in Simi Valley, just like most of California. I don't think any real estate agent representing a seller could advise him to accept an offer written on anything other than a CAR contract. Far too much liability attached. That equally applies if you are going to modify clauses in the contract.

If you really care about this, pay a real estate lawyer to write an Addendum that would answer your concerns, then submit that along with the CAR offer. Even then though, I doubt any seller would accept it when there are plenty of buyers who do not see this as an issue.

The only time you risk losing your EMD is if you default on the contract. The answer is not to default.
  • August 22 2014
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Profile picture for sunnyview
You can write up whatever you want and ask the seller to sign it, but why would any seller agree to return earnest money for any reason. 

Earnest money is held to keep buyers who lack commitment from backing out without financial consequences. The standard form used in CA has an inspection contingency that allows buyers to back out and get their money back if the inspection is not acceptable. It also has a financing contingency so that if the buyer is unable to secure financing they get their deposit back.

If what you want is a way to back out on the last day of escrow and walk with your deposit, then no seller should agree to that. What's in in for them to let you tie them up? This is a real estate contract not 50 shades of grey.
  • August 22 2014
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