Comments on: Foreclosure tips – Earnest money http://thresholdstl.com/real-estate-transactions/foreclosure-buying-tips-earnest-money Taking the St. Louis foreclosure, rehab, rental and multifamily real estate investor to the next level Mon, 26 Jul 2010 15:57:27 +0000 hourly 1 http://wordpress.org/?v=3.0 By: Matt Kastner http://thresholdstl.com/real-estate-transactions/foreclosure-buying-tips-earnest-money/comment-page-1#comment-28371 Matt Kastner Fri, 11 Jun 2010 17:13:38 +0000 http://stlinvestmentrealty.com/?p=1286#comment-28371 First off, I would recommend working with a buyer's agent. The commission is usually the same regardless of the number of agents involved. You are probably not going to save any money by not having someone represent you. I would really recommend finding someone to work with. As for your specific questions, I don't know your market and am reluctant to give specific advice in a situation like this. These are really questions to ask your own agent, who would be able to help formulate the best tactics for you and your market. That said, with foreclosures, I can tell you that you are generally required to submit the earnest money in the form of a cashiers check. However, for the sake of an offer, a personal check is usually fine as a starting point. In terms of earnest money $ amount, 1% really isn't a bump-up. I would say that is actually closer to a standard amount. Something like 10% would be more in line with something that would be a bump-up. But again, I would find representation to advise you on your specific situation. You really should find a buyers agent. Best of luck. First off, I would recommend working with a buyer’s agent. The commission is usually the same regardless of the number of agents involved. You are probably not going to save any money by not having someone represent you. I would really recommend finding someone to work with. As for your specific questions, I don’t know your market and am reluctant to give specific advice in a situation like this. These are really questions to ask your own agent, who would be able to help formulate the best tactics for you and your market. That said, with foreclosures, I can tell you that you are generally required to submit the earnest money in the form of a cashiers check. However, for the sake of an offer, a personal check is usually fine as a starting point. In terms of earnest money $ amount, 1% really isn’t a bump-up. I would say that is actually closer to a standard amount. Something like 10% would be more in line with something that would be a bump-up. But again, I would find representation to advise you on your specific situation. You really should find a buyers agent. Best of luck.

]]> By: Isabelle http://thresholdstl.com/real-estate-transactions/foreclosure-buying-tips-earnest-money/comment-page-1#comment-28358 Isabelle Fri, 11 Jun 2010 03:37:54 +0000 http://stlinvestmentrealty.com/?p=1286#comment-28358 Dear Matt, Thank you for sharing your RE wisdom. It is most appreciated. Since we will be working without a buyer's agent and with the seller's agent exclusively, your help in this arena is welcomed. I hope you don't mind a few questions......and although we are in a different state, your answers will help my understanding. Background..... The property has not been listed on MLS and the prior owners are still in possession. The bank and the listing agent are aware of our interest. The property is well above the average and median sale price for this area....less than 3% of all monthly sales range. I am assuming that an investor would not be interested in it, but competition would likely come from someone like us that would want it for their residence. FYI...We are pre-approved. Questions..... 1) For bumping the earnest $, is 1% percentage of offer price advisable.....say $4k on a $400k purchase price? 2) Could you please suggest wording you would use in the contract for the earnest money guarantee/non-refundable and in particular..."after the end of any inspection contingency". 3) Would you recommend a cashiers check over a personal check for the earnest money? 4) Since we may not know the extent of damages (until after inspection), what is the best way to negotiate the repairs? Again, thank you for assisting, Isabelle Dear Matt,

Thank you for sharing your RE wisdom. It is most appreciated.

Since we will be working without a buyer’s agent and with the seller’s agent exclusively, your help in this arena is welcomed. I hope you don’t mind a few questions……and although we are in a different state, your answers will help my understanding.

Background…..
The property has not been listed on MLS and the prior owners are still in possession. The bank and the listing agent are aware of our interest. The property is well above the average and median sale price for this area….less than 3% of all monthly sales range. I am assuming that an investor would not be interested in it, but competition would likely come from someone like us that would want it for their residence. FYI…We are pre-approved.

Questions…..
1) For bumping the earnest $, is 1% percentage of offer price advisable…..say $4k on a $400k purchase price?

2) Could you please suggest wording you would use in the contract for the earnest money guarantee/non-refundable and in particular…”after the end of any inspection contingency”.

3) Would you recommend a cashiers check over a personal check for the earnest money?

4) Since we may not know the extent of damages (until after inspection), what is the best way to negotiate the repairs?

Again, thank you for assisting,
Isabelle

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