What is The "Earnest Money" Deposit?

The earnest money deposit is a "show of good faith" that underscores the buyer's seriousness of purpose and gives confidence to the seller to be able to take the property off the market during the "due diligence" or escrow period (from contract to closing, usually 30-45 days).

The buyer's earnest money check is not deposited in an escrow account until there is a signed and accepted (i.e. "ratified") contract, and will be governed by state law handling of escrow accounts.

When we represent buyer clients, we usually include 6 contingencies that our clients can use to release a contract "with cause" and get their earnest money deposit refunded ...

Distressed properties normally go through 3 stages. Each has different advantages and disadvantages. 

Time is a scarce resource. When you are searching for the right home, it pays to have the best technology tools at your disposal! We are now offering a new service: Automatic daily, weekly or bi-weekly alerts, which sends all new listings that fit your search criteria AUTOMATICALLY to your email. So you don't have to spend as much time looking online, or starting from scratch every time you sit down to search.

If you would like to set up your own listing alert, please visit our sister website, FindHomesInCharleston.com . Just click on "My Tools" and scroll down to "My Alerts.

Robert Weaver from Ikon Mortgage put together this information - which I found really informative - about the maximum allowed contribution from Seller to Buyer depending on the LTV (loan-to-value ratio) and the use of the home:

For more information contact Robert Weaver.

HOW TO WIN IN A “MULTIPLE-OFFER” SITUATION

You and your REALTOR® have spent many hours “weeding out” potential homes for sale and finally find the home of your dreams: It is priced right, perfect size, location, features, etc. and you don’t want to miss out on this opportunity, so you go see it as soon as it is listed… and then, while you are walking through, two other parties arrive to view it. So you have competition (no surprise, since well-priced homes are still selling well!). It is pretty obvious that, even if you write an offer immediately, the listing agent will call your agent to say that there will be multiple offers. How can you improve your odds that YOUR offer is the one acc...

THE RISKS OF BUYING DISTRESSED HOMES, FORECLOSURES AND REOs!

It seems that every time we meet with new buyers, the first word that comes out of their mouth is “foreclosures”. Buyers have been bombarded with news about the “state of the market” and the amazing buying opportunities that are available to them. Many buyers are not aware that there are three “stages” that a distressed property goes through, and that each of these may present different challenges and opportunities. Here is a summary of these stages:

1.      Stage 1 – Pre-foreclosure

When the homeowners experience a hardship that prevents them from keeping current with their mortgage payments, they normally start exploring re...

Cramped Quarters? Still Renting? Invest Your TAX REFUND Smartly!

This is the time of the year when most employed people file their taxes and may receive a refund from Uncle Sam. For many people, this refund just goes into their general bank account, and before they know, it's gone (again!).

IF YOU ARE RENTING: A wiser investment would be to look at purchasing a home using your refund as downpayment. Consider the current situation:

SHOULD YOU PAY CASH FOR A HOME?

If you have the cash and plan to buy a home, there are different issues to consider to determine your best strategy.

First, you may consider peace of mind. Does having no debt make you sleep like a baby? 

Next, consider financial effectiveness, tax and retirement planning. If you pay cash for a home and in the future need to refinance with cash out to use some of the equity, the interest you pay on the mortgage will NOT be tax deductible.

The tax code says that deductible mortgage interest must be from either:

Tips for Buying Lender-Owned Properties (REOs)

by Alan Donald, Team Leader, BuyHomesInCharleston.com

Every buyer in this market wants a bargain! And while you may want to hit the jackpot by buying foreclosed properties – those homes that are offered as real estate-owned (REO), lender-owned or corporate-owned properties - it is essential to understand the differences between buying a “regular” listing and buying an REO.

Lenders are not in the business of owning real estate. Once they decide to foreclose on a home and on-sell it, they are looking for:

In addition, you should know that:

This new SHORT SALE listing is a 3 bedroom, 2 bath Duplex in The Gates @ Wescott Plantation, Summerville. It just needs a little TLC (paint, cleaning) and you could buy this home and end up paying less than rent! Dorchester II schools, easy access to Charleston International Airport and Boeing. 

Great for investor or owner-occupier with patience - short sale may take some time...

More details...

Are Lender-Owned Properties (REOs) Smart Options for Buyers?

By Alan Donald, BuyHomesInCharleston.com

It seems that one out of three properties in the Charleston Metro Area is either a SHORT SALE or an REO (*)

(*) An REO (Real Estate Owned) is a lender-owned property - a property that has already been through foreclosure and is being offered for sale directly by the lender after taking control of it. 

Normally these properties are offered at very attractive list prices, so many of those properties offer terrific buying opportunities. But, like the old saying says: "Don't judge a book by its cover", there may also be challenges associated with buying REOs. Here is a list of potential p...

Affordability remains at record levels, supported by the lowest mortgage rates in decades, low home prices, and the first-time home buyer tax credit.

The home price-to-income ratio continues to remain well below the historical average of 25 percent. The ratio now stands at 14.2 percent.

Would-be buyers should consider their COST to buy and not only the PRICE of the home. While it is true that we may still not be at the bottom of the market in terms of prices, any increase in mortgage interest rates (and rates ARE under pressure to increase) could erase any potential gains from waiting to buy at the very bottom of the market.

The National Association of Hispanic Real Estate Professionals (NAHREP) published this interesting article on their blog about the role that minorities will play in helping the U.S. housing market back on its feet (click link to read article):

The Color of the Housing Resurgence by Alejandro Becerra

I believe that many people underestimate the power of demographics when it comes to real estate. It is always very important to keep in mind national, regional and local population trends.

Most national builders know this and hire bilingual site agents. However, many service providers and lending institutions in the Charleston area are still ignoring it - for example - in our area there are...

Aaaarghh! I Just Can't Decide!!! Let Me Ride On a Helicopter...

As inventory increased in the years following the "sub-prime meltdown" and we switched from a "seller's market" to a "buyer's market", many buyers experienced MORE DIFFICULTY in making a puchase decision.

(OK, hold it, wasn't it supposed to be easier, now that there are more choices available...??)

The fact is that having MANY options sometimes OVERWHELMS buyers and causes BUYER PARALYSIS!

Buyers are comparing different types of homes (private sales, short sales, lender-owned, foreclosure auctions) that have different advantages and disadvantages, features. special prices, incentives and gimmicks.

To keep the buying proc...

Buyers and sellers have agreed to terms and conditions, the buyers have done their inspections, repairs have been agreed and done by the seller, the attorney has done the title work, the appraisal has been done, everything seems going perfect to close on time...

Enter, the lender's UNDERWRITER.

During the housing boom that ended three years ago, underwriters were just an extra check, and they were not really very concerned about confirming every little detail on the loan application, the contract and the origin of the deposit money. Maybe that's one of the reasons why we are in this mess altogether!

This has changed! Today underwriters have (it seems) unlimited power to minutiously dis...