THE EARNEST MONEY CONTRACT

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You found the home you have been looking for! What Next??? You are finally ready to write the contract. The standard form used in the State of Texas is the earnest money contract. There are many forms of the earnest money contract depending on which type of financing you are seeking and the property. Most of us purchase a "single family home" so I will focus on that.

There is a VA, FHA, and a Conventional Earnest Money Contract. I will focus on the Conventional Earnest Money Contract.

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LEGAL DESCRIPTION

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This is the survey description. This is the that the property is recorded under. This description is for the land only, improvements are the home and they are transfered with the land.

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ADDRESS

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This is the street address. Remember you are buying the land, the house is considered an improvement with everything that is attached to the house considered to be a part of the real property.

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SALES PRICE AND DOWN PAYMENT

This is the offer stated in the contract. The amount of down payment and the amount to be financed equals the sales price. Simple.

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TYPES OF FINANCING

This section specifies how many days you have to apply for your loan and how many days you have to get an actual approval.

EARNEST MONEY

This is the amount of money you offer in good faith because the seller will be taking his home off the market. This money is not paid to the seller but held in trust usually by a title company.