Deb Tebbs Group

Cascade Sotheby's International Realty

Category: Real Estate

Earnest Money Vs. Deposit – What’s The Difference?


Is there a difference between earnest money and the deposit? The answer to this question is yes.

In this article we will break down the difference between the two so you will be fully prepared to purchase your next home in Bend or elsewhere in Central Oregon.

What is an earnest money deposit?

Earnest money—also known as an escrow deposit—is a dollar amount buyers put into an escrow account after a seller accepts their offer.

Another way to think of earnest money is as a “good-faith” deposit that will compensate the seller if the buyer breaches the contract and fails to close.

Earnest money deposits usually range from 1% to 2% of the purchase price of a home—depending on your state and the current real estate market—but can go as high as 10%. If a home costs $300,000, a 1% earnest money deposit would be $3,000.

The buyer’s financing can also dictate the amount of an earnest money deposit. For example, if a buyer makes a cash offer, the seller may request more earnest money to show a true “buy-in” from the purchaser, says Matthews. In that instance, the seller of a $300,000 home might want a 3% deposit (or $9,000) versus the 1% deposit for an offer financed through a mortgage.

In any case, the seller can either accept, reject, or counter the buyer’s suggested earnest money deposit amount, says Realtor® Bruce Ailion, of Re/Max in Atlanta.

Earnest money deposits are delivered when the sales contract or purchase agreement is first signed. They are often in the form of the buyer’s personal check. The check is held by the buyer’s agent (never given directly to the seller) and is sometimes never even cashed, says Brian Davis, co-founder of If the check is cashed, the funds are held in an escrow deposit account. The money will be shown as a credit to the buyer at closing and will offset part of the down payment amount or closing costs.

So here’s the real crux of the matter: If a prospective buyer backs out of the deal, the seller might be able to keep the earnest money deposit.

Matthews advises sellers to comb through the contract to see if they can take legal action. But keep in mind that if the buyers back out for any reason allowed by the contract or purchase agreement, they are legally entitled to get their earnest money back.

What is a down payment?

A down payment is an amount of money a home buyer pays directly to a seller. Despite a common misconception, the down payment is not paid to a lender. The rest of the home’s purchase price comes from your mortgage.

The down payment money can come from the seller’s personal savings, the profit from the sale of a previous home, or a gift from a family member or benefactor.

Down payments are usually made in the form of a cashier’s check and are brought to the closing of a home sale.

Typical down payment amount

The exact amount of a down payment is often determined by the lender in relation to the overall loan amount. The minimum down payment required by mortgage lenders is 3% of the house’s price, and a 20% down payment is recommended by the real estate industry. But that’s not to say you have to put down 20%. After all, that’s a large chunk of change to have on hand, especially for first-time home buyers.

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To get started with searching for a home in Bend Oregon contact us today by calling (541) 323-4823 or click here to connect with us online. 




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What to Expect In the Bend Oregon Real Estate Market For 2016


BEND, Ore. – There’s no denying that 2015 was a great year for the Bend Oregon Real Estate market and now that spring, and the snow is melting, the local Real Estate market is heating up and many people are wondering what we can expect in 2016.

In this post we will share with you several things you can expect from the Bend Oregon Real Estate market in 2016 regardless if you plan on buying or selling a home.

If You Plan On Buying a Home

Buying a home in Bend is going to be more competitive than it was last year because recent reports have shown that Oregon was one of the top relocation destinations during 2015 and that’s only expected to continue this year especially since Bend enjoys over 300 days of sunshine per year and has excellent outdoor recreation options that you can enjoy all year long.

“There is more pressure on new listings than we had last winter, and a higher number of homes are selling within the first 30 days,” says CEO of John L. Scot Real Estate Lennox Scott. “This is setting up the stage for a frenzy market in the spring of 2016. Even if interest rates go up slightly, buyer demand and low inventory still push prices up.” A search on Craigslist Portland shows 1-bedroom apartments renting for a minimum of $1,000. This has caused the Portland City Council and Multnomah County Board of Commissioners to declare housing states of emergencies. Areas outside of Portland are being driven up exponentially as well. In Lake Oswego and West Linn the median home price is around $450K. Likewise, the Tigard, Tualatin, Sherwood, and Wilsonville markets are all above $362K. But there is still desirable Oregon real estate not far outside the Portland city limits that remain affordable. Median prices in Beaverton and Aloha are below $280K, and in Gresham, Troutdale, Sandy, Corbett, and Fairview prices are still below $260K.

Source – Housing Predictor  

If You Plan On Selling Your Home

2016 is also going to be a great year to sell a home in Bend Oregon because more buyers will be pre-approved for mortgage loans thanks to historically low interest rates and since we still have a housing inventory shortage we can expect the demand for homes in Bend to be huge.

Before listing your home for sale make sure you do the following:

  • Clean up your home thoroughly inside and out.
  • De-clutter your home by removing big pieces of furniture.
  • Remove all personalization from your home including your artwork, pictures and decorating choices so your home feels more like a “product” than your house.
  • Start packing up your home now and place those boxes neatly in your garage or storage.

Contact the Deb Tebbs Group

Get stared with selling your Bend Oregon home today by contacting the Deb Tebbs Group at (541) 323-4823 or CLICK HERE to connect with us online.

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Do you still need a Realtor® to find Bend Oregon homes for sale?

Bend Oregon homes

One of the biggest questions on the minds of many people is will we still need a Realtor® in 2016 to find Bend Oregon homes for sale? And the answer to this question is yes.

In this post I will provide you with three reasons why you will still need a Realtor® in 2016 to find Bend Oregon Homes for Sale and how a qualified Real Estate agent will help you with all of your Real Estate needs.

#1 – Real Estate Agents Have Real Local Experience

Even though the Internet is full of online resources like Zillow and Trulia that you can use to find a home in 2016 the reality is that the data you will find on many of these websites is either inaccurate or outdated.

When you hire a Realtor® to find Bend Oregon Homes for Sale you will benefit from having an agent who works in the field on a daily basis and they will many times know of properties before they come to market and are listed online.

Working with a Realtor® will give you the competitive advantage over another buyer who is relying on online data for buying the right home.

#2 – Only A Real Estate Agent Will Know The Finer Details Of A Home

Although a Real Estate website may provide you with the aesthetic details about Bend Oregon Homes For Sale the reality is that an online search can only go so far because a computer can’t tell you if a home was built with potentially hazardous materials or has details that you will want to change when you move in to improve the safety and security of your home.

#3 – An Experienced Agent Will Advise You On Offering The Right Price For A Home

Last of all, but most important, an experienced Real Estate Agent will advise you on the right price to submit on Bend Oregon For Sale rather than just relying on online data which can be off by as much as 40 percent or up to 12 months old.

Search for Bend Oregon Homes 

Save time and money when searching for Bend Oregon Homes for Sale by working with an experienced Real Estate Agent.

To get started with searching for a Bend Oregon home for sale contact the Deb Tebbs group today by clicking here to connect with us online or calling us at (541) 323-4823.

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