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Learn about important factors to consider when customizing the promissory note.
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Buying real estate is a costly endeavor, both in terms of money and time. During the purchasing process, it is not uncommon to face competition from other buyers. When this happens, a seller may demand that you show your commitment to buying the property by providing a deposit. While this deposit could help separate you from the pack of buyers, it is never a good idea to give cash to a prospective seller. And that is assuming you can even come up with that amount of cash in time.
In such cases, you may wish to offer an earnest money promissory note as evidence of your good faith to purchase the property. The promissory note will detail the amount of your earnest money deposit, which is essentially money put up by a potential buyer to show that they are seriously interested in making the purchase. The money is usually paid within 24-48 hours after the offer is accepted, and is held by a third party or escrow company until the deal is completed.
There are many factors to take into consideration when it comes to using an earnest money promissory note. These factors are discussed in detail in LegalZoom's Earnest Money Promissory Note package. The sample document and instructions will help you customize and complete your earnest money promissory note, and get you well on your way to purchasing the property.
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