Posted by JohnBoy on March 04, 2002 at 10:29:36:
The most I ever put up as earnest money is $100 whether I’m dealing with the seller directly or a realtor involved. Although I rarely ever get involved when realtors have a listing, but when I do I only put up $100. So I’m not concerned about who holds the earnest money.
Now if I was to put up more then I would insist on using MY title company or attorney to hold any earnest money. Otherwise no deal, with the exception of knowing it was a deal to good to pass up and I had every intention of closing it on my end. Then what difference would it make. If I had doubts or needed to have a contingency to back out because I would be needing to find another buyer to flip to or something, then I would require using my Title Company or attorney to hold any deposits.
Bottom line. I’M the buyer and they need ME more than I need them! If they want the opportunity to get MORE business from me in the future then they learn to play by my rules early on in the game or they don’t get anything, period! He who holds all the gold makes all the rules! When I’m the one buying I hold all the gold! They can’t sell without a buyer!
As far as only putting up a $100 as earnest money, most agents will tell you they need at least $500 - $1000. BS! Sorry, but the truth be known they don’t NEED anything! An earnest money deposit isn’t even required by law to make a contract binding. This is just realtor mentality. But I just tell them that I submit over a 100 offers per month and if I had to put up $500 - $1000 in earnest money on every offer I would have to tie up $50k - $100k a month in just earnest money deposits! Ain’t gonna happen! They are required by law to submit ALL offers. If they refuse to submit your offer then go around them and contact the seller directly! Inform them that you wanted to make an offer but their agent is refusing to submit it to them for some reason and you just wanted to make sure they had the opportunity of considering it before moving on to something else.
As far what your addendum would say, a lot of agents don’t even read it over that closely! They seem to be happy that you used their forms and don’t pay much attention to what the addendum says. It just depends on the agent.