The second earnest money deposit, often referred to as the final earnest money check, is typically required during the later stages of the home-buying process in Long Island. After the initial offer is accepted and the contract is executed, the first earnest money deposit is usually made to demonstrate the buyer's commitment to the purchase.
The second earnest money deposit comes into play after certain milestones have been reached, such as completing the attorney review and inspection period, resolving any issues that may have arisen during these processes, and finalizing financing arrangements. Once these steps are completed satisfactorily, the buyer is typically expected to provide the second earnest money deposit.
Similar to the first earnest money deposit, the amount of the second earnest money deposit is usually specified in the purchase contract and can vary depending on factors such as the purchase price of the home and local customs. It's important to follow the instructions provided by your real estate attorney regarding the amount and timing of the second earnest money deposit.
The purpose of the second earnest money deposit is to further demonstrate the buyer's commitment to the purchase and to provide additional security for the seller. Like the first earnest money deposit, the second deposit is typically held in escrow until the closing, at which point it may be applied toward the down payment or closing costs.
When writing the check, include "2nd EM check for (insert property address)" in the FOR line. Place the check in an envelope without sealing it, and on the outside, write "2nd EM check for (insert property address)" along with your name.
Typically, the check is dropped off at the seller's realtor's office during normal business hours. Be sure to request an earnest money receipt from the receptionist upon arrival, which you'll need to email to me. Once you've received the receipt, seal the envelope and hand it to the receptionist.
Additionally, please inform me after dropping off the check so I can inform the seller's Realtor promptly. This ensures smooth communication throughout the process.
