All Topics / Help Needed! / $1 deposit!!!

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  • Profile photo of jeweljewel
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    @jewel
    Join Date: 2005
    Post Count: 30

    Hello All

    I am signing a contract today on a property. Normally I put down a $100 deposit but I have heard through the grapevine that the buyer is entitled to put down $1 if he/she wants to. Is this true?

    Profile photo of Peace-SunshinePeace-Sunshine
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    @peace-sunshine
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    I don’t know Jewel but I do know that Real Estate Agents will always try to make you pay more than you should have too. I think that you can offer them 50cents if you want but it is a sign of good faith. Are you tight with money?

    Where is the love?
    Sunshine

    Profile photo of jeweljewel
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    @jewel
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    C’mon guys there must be someone out there who can tell me if I have the right to put down a $1 deposit

    Profile photo of SeeChangeSeeChange
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    @seechange
    Join Date: 2003
    Post Count: 66

    You can put down whatever deposit the Vendor is prepared to accept.

    The agents usually like a deposit that will cover their fees….

    See Change

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
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    Yes its true! You could also use your left shoe instead.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
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    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of SeeChangeSeeChange
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    @seechange
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    Originally posted by Terryw:

    Yes its true! You could also use your left shoe instead.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Finally , a reason to work out how to edit typo’s….. [blush2]
    See Change

    Profile photo of Don NicolussiDon Nicolussi
    Participant
    @don
    Join Date: 2005
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    What state are you in? The reason you could put $1 down in NSW is because pre exchange of contracts deposits have no legally binding effect on the parties. This has been well established in a long line of case law.

    These are a gesture of good faith and intent only. If it was my property and agent told me the prospective purchaser could only come up with a dollar I would probably ask them if they were serious and or tell him to stop wasting my time!

    Cheers

    Don Nicolussi | Mortgage Broker - Home Loan Warehouse
    http://homeloanwarehouse.com.au
    Email Me | Phone Me

    "I think of finance as a technology, a way of getting things done." Robert Shiller

    Profile photo of kay henrykay henry
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    @kay-henry
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    I would accept the $1 if the property I was selling to you, jewel, was $10. I would accept $100 if the property was sold for $1000- ya know- 10% of purchase price.

    I can’t believe this area of property transactions is not more regulated. If a purchaser messes over a vendor, then the vendor is entitled to the deposit- which in this case, will be $1… How can that be?

    not sure of other people’s solicitors, but I know that 10% of purchase price has always been demanded by the vendor’s solicitor in any transaction I have made, and my bank will not allow for less than 10% to be paid either.

    Actually, i have no idea why no money down deals are so popular- your return is not gonna be on the $1 you paid as deposit, jewel- it is gonna be on the 106% you borrow (as per your other posts).

    kay henry

    Profile photo of GoldCoastGirlGoldCoastGirl
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    @goldcoastgirl
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    Regardless of what amount you can put down, I personally will stick to my own rule that I will put down $1000…. as it is a sign of “good faith”.. that you are serious.

    If someone put down $1, I would have to ask if they were serious. If they were, I would be perplexed to know why they wouldn’t put down a ‘bigger’ amount to show their intentions and seriousness in re: the purchase.

    :) Wishing everyone radiant health!
    Vanessa


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    Profile photo of gatsbygatsby
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    @gatsby
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    Hi Jewel,
    I think the amount of deposit show’s your integrity and seriousness in wanting the purchase. Everyone’s situation and attitude for purchasing is different. If it was me ‘at the present moment in my circumstances’ and I really wanted to purchase this property I would be looking at putting down a ‘20% deposit’ (assuming one has these funds to do so) to ensure to the vendor that I am genuinely serious about purchasing and to avoid LMI as well) and would add in on the contract a few caveats ‘to my benefit’ on the purchase to ensure the deal to make the vendor appreciate how ‘serious’ I am compared to other prospective purchasers on the property/deal. It would put the vendor more on the back foot.
    Regards,
    Gatsby.

    “Sometimes the hardest thing to do in life is often the best thing to do.”

    Profile photo of Robbie BRobbie B
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    @robbie-b
    Join Date: 2004
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    A reason behind asking to only put down $1 is because the buyer may not have funds available but plenty of equity. If this is explained to the vendor, there is no reason why it should not be accepted.

    A deposit bond may stem the problem but it would cost more than $1 (a few hundred actually).

    The Mortgage Adviser


    http://www.themortgageadviser.com.au
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    Essential Links


    Profile photo of Still in SchoolStill in School
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    @still-in-school
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    Post Count: 1,844

    why even put a dollar down, seriously.. ive done contracts, with no money exchanged, though the most ive had to do, in as deposits, is normally a cheque of $500 – $1000

    Cheers,
    sis

    Wanna Talk About Stocks

    Profile photo of Robbie BRobbie B
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    @robbie-b
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    Post Count: 2,493

    The no deposits has been discussed in another thread. It does not always work.

    The Mortgage Adviser


    http://www.themortgageadviser.com.au
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    Profile photo of westinvestwestinvest
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    @westinvest
    Join Date: 2005
    Post Count: 88
    Originally posted by The Mortgage Adviser:

    The no deposits has been discussed in another thread. It does not always work.

    The Mortgage Adviser


    http://www.themortgageadviser.com.au
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    Maybe not, but for our past 1.2 m in contract’s it has.
    Regards

    Profile photo of oshenoshen
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    @oshen
    Join Date: 2005
    Post Count: 112

    I had a strange situation recently on a contract where I didn’t want to put down a huge deposit. The REA wrote down that I would pay $500 or whatever deposit on exchange of contracts and 10% deposit payable at settlement. Apparently this would make the vendor feel better about it since they are getting a 10% deposit. Maybe they’re supposed to not notice that it isn’t payable until settlement? I thought it was all a bit strange myself. This happened in QLD.

    Profile photo of westinvestwestinvest
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    @westinvest
    Join Date: 2005
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    Originally posted by oshen:

    I had a strange situation recently on a contract where I didn’t want to put down a huge deposit. The REA wrote down that I would pay $500 or whatever deposit on exchange of contracts and 10% deposit payable at settlement. Apparently this would make the vendor feel better about it since they are getting a 10% deposit. Maybe they’re supposed to not notice that it isn’t payable until settlement? I thought it was all a bit strange myself. This happened in QLD.

    This is one thing that gets up my hooter about Detosits,Ajents “for” Vendors making up there own silly rules as they go along.
    I would be temted to give that agent a good slap and walk from the offer.
    regards

    Profile photo of Robbie BRobbie B
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    @robbie-b
    Join Date: 2004
    Post Count: 2,493

    How is that a ‘rule’? It is just how the agreement was worded. It is no big deal!

    The Mortgage Adviser


    http://www.themortgageadviser.com.au
    [email protected]
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    Profile photo of eklein11651eklein11651
    Member
    @eklein11651
    Join Date: 2003
    Post Count: 4

    I know a guy who put down 5 cents as deposit….beat that ! Usually a contract is not legal unless some consideration has been put forward…….the old $1 down is just a good laugh and quiet do-able..i’ve done it myself…but if you want the deal to go through, go for a grand and tell ’em your borrowing the rest against other properties….which the banks will happily put up at settlement. Do they want to sell or not ???? who are they to tell you how to pay for it, as long as it’s there when it needs to be.
    EK Gold Coast

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    I think consideration is different to deposit. There would be no requirement to put down anything at all if the vendor could agree to that.And it would still be a valid contract. Consideration is the promise to pay the full price.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of plpropertyplproperty
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    @plproperty
    Join Date: 2005
    Post Count: 50

    I imagine the majority of vendors worldwide wouldn’t be impressed if someone offered a $1 deposit. Get real.

    Luke Woollard
    Licensee
    Pacific Lifestyle Property
    http://www.plproperty.com.au

    comments made are general information only. you should seek professional advice for your particular circumstances.

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