Earnest Money Shows You’re Serious
Typically when an offer to purchase a house is made, you, as the buyer, will also pay an “earnest money” deposit. This deposit shows the seller that you’re serious about the offer to purchase the property, because it is what you stand to lose if you change your mind or otherwise cannot "close" on the home.
The amount of earnest money deposit varies based on the type of property being purchased and the current market conditions in Pasco and the rest of the TriCities. The required earnest money on all Monogram homes is $1500. There are some exceptions to this however. Sometimes, if you use one of Monograms preferred lenders, the builder may except $1000. This is because the builder views the contract as less of a risk because the home is being financed through a proven mortgage company, one who has successfully closed many transactions with Monogram. Other times the builder may require a larger than normal deposit. For example, if a customer wanted to add an extraordinary amount of upgrades or if they wanted to customize something, the builder may require $2000 or more depending on the situation. This increase in earnest money requirements is in direct relation to the increased risk the seller is taking. The further from "average" or "basic" the new home is, the less potential buyers there will be for that particular home, and thus the longer time it will take to resell that property to a new buyer.
Once the home is completed the buyer will sign all necessary paperwork, including financing documents, and soon after the loan will "close". At this point the earnest money deposit is credited back to the buyer, possibly as a credit applied towards the closing costs or towards the purchase price of the home.