tag:blogger.com,1999:blog-7800674.post115876361397968544..comments2023-06-22T05:23:55.920-07:00Comments on Shaun's Real Estate Adventures: Market Flushes Out The Not-So-SeriousShaunhttp://www.blogger.com/profile/05654897560778650994noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-7800674.post-1158991259747002592006-09-22T23:00:00.000-07:002006-09-22T23:00:00.000-07:00In '82 I bought a 20K house and put down $1000 in ...In '82 I bought a 20K house and put down $1000 in earnest money.<BR/><BR/>It looks like the banks may be going back to 5% earnest money?<BR/><BR/>After all the fraud and nonsense that's been happening in the RE market the past several years, it would not be surprising for banks to go back to 5% earnest.<BR/><BR/>1K earnest on a 150K property sounds laughable under normal circumstances.<BR/><BR/>With all due respect, it sounds like your realtor does not have a clue.<BR/><BR/>The Senate has been looking in to the RE mess of the past several years and banks are starting to realize that they made HUGE mistakes with the lax lending standards.<BR/><BR/>Sounds like things may be going back to "normal".<BR/><BR/>Next step: 20% downpayments.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7800674.post-1158937943160902182006-09-22T08:12:00.000-07:002006-09-22T08:12:00.000-07:00I've never bought a bank owned property before, I ...I've never bought a bank owned property before, I so can't answer your question based on any experience. I do know that there were people who tried to defraud banks by flipping properties and artifically increasing the market value (by increasing the price with each flip - which would typically be bought by their partner in crime). I agree that 10% down on a $75,000 house is a bit much. All things are open to negotiation. Ask the bank if they will accept $3K down with the 3 month hold. Show them some numbers that show how much your holding costs will be for the three months. Tell them that justifies a lower earnest money. Make the numbers for your holding cost plus the $3K (or whatever amount you decide) be close to their $7,500 earnest money requirement. In other words, show them you will have that much in the property even with the lower deposit. FYI, I've never flipped a house in less than 3 months, so I don't think their 3 month deed hold is an issue.Shaunhttps://www.blogger.com/profile/05654897560778650994noreply@blogger.comtag:blogger.com,1999:blog-7800674.post-1158908235937512822006-09-21T23:57:00.000-07:002006-09-21T23:57:00.000-07:00Shaun,Question for you. I found a bank owned prop...Shaun,<BR/><BR/>Question for you. I found a bank owned property in my area that can very well net me 30K once all the dust clears. Here's the downfall of the property. The bank has put a 3 month deed hold on it and they are mandating 10% down on ernest money which equates to $7500. Is this something new? Why would they mandate such a high price for ernest money? My realtor says the 3 month deed hold is becoming common because of fraud within the flipping trade. But as for the ernest money she states typically if a house is under 150K 1K should be sufficient for an ernest payment. What are your thoughts. Is this the norm on bank owned REO properties?<BR/><BR/>BillyAnonymousnoreply@blogger.com