L.A. real estate news and insights.
If the buyer refuses to send cash as their deposit, find another buyer.
Remember, the deposit is sent over within the first 3 days of opening escrow.
If the buyer is this difficult to work with just 3 days in, imagine how hard it will be for the rest of the 30 day escrow period.
As soon as you accept an offer for someone to buy your home, the buyer has to send over an all-cash good faith deposit.
This deposit is typically 3% of the purchase price of the property and is held by the escrow company in an escrow account just in case the buyer breaches the contract and you want to try to collect for damages.
If the buyer wants to send over anything but cash as their deposit, say no!
I have heard of buyers trying to use necklaces, #Rolex watches, and all types of other items for their deposit.
There are a few problems with this.
1) Will the escrow company hold a physical item as a deposit?
2) What is the true appraised value of the item?
3) Is that item real and authentic?
Because so many problems can arise out of this, only accept cash as your deposit.
If the buyer refuses, find yourself another buyer.
Under current California law, after there is a change in ownership of a home, the property is reassessed.
The supplemental bill is paid by the buyer of the home and covers the difference between the previously assessed value taxes and the newly assessed value when you purchased the home.
Think of it as a catch-up bill.
For example, the home you just purchased was last sold back in 1970 for $50K, you now bought that home for $750K.
The supplemental tax bill covers the difference between the $50K and $750K.
The tax in this example is going to be around $5,000.
You may see the supplemental bill within a few months of buying your home.
You may also receive a supplemental tax bill for changes that add property value, like adding square footage or special features like a swimming pool or fireplace.
