Closing Costs Vs. Down Payment Vs Earnest Money or Good Faith Deposit???
Closing Costs Vs Down Payment Vs Earnest Money or Good Faith Deposit?
HI, welcome back to the Ridge Real Estate Group’s Vlog! Today’s topic is closing costs, down payment or good faith deposit. We get this question all the time when we’re writing offers for our buyers. All of a sudden they are hearing all these things about a down payment and then closing costs. So we want to clarify some of this confusion. Let’s discuss the closing cost vs. a down payment.
Closing Cost’s usually consists of lender fees, title and escrow fees, prorated interest and taxes up front.
A down payment – If you are doing a simple conventional loan, 20% down of your total loan of the total load is the down payment.
The earnest money deposit, is a portion of the down payment. Let’s say, you put a $10,000 deposit on a $20,000 deposit, you will only need the additional deposit. There is no additional costs to the buyer, it just means that you are putting the 10,000 in good faith and move forward, according to the terms of the contract.
Thank you for watching our video! This is Jessica Evans and Steve Ridge with the Ridge Real Estate Group and we have been “Building Relationships for Generations.”
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