Question:
“We’re shopping for a home and I’d like to know if there are any rules about a minimum or maximum deposit?”
Answer:
No and no.
Contrary to popular belief, an initial deposit is NOT legally required.
While a contract must have consideration to be valid and enforceable, the consideration for the purchase of a $500,000 home can just be the promise to perform and pay $500,000.
And there’s no maximum. I’ve seen the initial deposit be the actual total price of the home.
In practice, deposits tend to be 1-3% of the purchase price.
Note: As this is a legal question, please verify this with a legal professional.
