You’ve found the perfect house and you want to submit an offer. Your Buyers Agent will draw up an offer known as a ‘Contract to Purchase Real Estate’. This will detail items such as the offer price, time frame for closing, whether you are paying cash or obtaining financing, conditions such as home inspections and any Seller concessions.
You will also need to provide a small good-will/good-faith deposit with your offer, payable to the Listing Office. The deposit is usually between 1-3% of the purchase price. This deposit is not a down payment, but rather an earnest money deposit to let the Seller know that the offer is genuine, true and you are serious.
If the offer is accepted, the contract is signed and becomes legally binding. At this point the good faith monies are deposited into the listing Offices Escrow account.
In the US, time is of the essence in meeting deadlines, and and failure to observe dates stipulated in the contract, can result in you losing your deposit. A good Buyers Agent will keep a close eye on these dates and request extensions if needed, to avoid you losing your deposit.