Non Refundable Deposit - How to Make an Offer More Competitive

A Non-Refundable deposit is a way to make an offer more competitive.

A non-refundable deposit is when a deposit on a house would be agreed to be released to seller should the buyer not be able to perform by the contract.

This can be very attractive to a seller when choosing an offer.

As an example, let’s say you agreed to a non-refundable deposit without a mortgage contingency. You do an inspection for informational purposes only and find issues and decide to walk away from the agreement. The initial deposit would automatically revert back to the seller.

Or as an example let’s say you were denied the loan after the Purchase & Sale Agreement was signed, then the entire deposit would revert automatically back to a seller.

You can see how this can be risky.

But a buyer can also negotiate a certain portion or maybe only the first deposit. You can get creative with what you are offering a seller.

There is a lot of risk here. So proceed with caution.