Sacramento Real Estate Explained: What is the initial deposit???
Doug Reynolds, a Sacramento area Realtor, provides explanations to real estate terms.
In this video i explain what the "Initial Deposit" is. Sometimes also referred to as the "Good Faith Deposit" or the "Earnest Money Deposit." In the Sacramento Area, the standard amount is a minimum of 1% of the offer/purchase amount. Many times it can be more than that. The higher the initial deposit amount in the offer, the stronger it makes your offer to the seller.
If your offer is accepted, your initial deposit needs to be to escrow within 3 business days of the acceptance. Escrow will cash the check and hold onto it in their bank during the transaction. This is the buyers "skin in the game" for the seller to take their house off the market and commit to you as a buyer.