Most paychecks today go just to pay bills. Some have a little saved, but it's a struggle. Buying a home may clean out your savings. However, it is worth it!! You will stop paying your landlord's mortgage with your rental payments, you will have a home you can call your own, PLUS you get a tax deduction!!

Earnest money is intended to make transactions clean and simple for both buyers and sellers and it is required by Georgia law to make a contract valid. Buyers tender an amount of cash to demonstrate that they are "in earnest" about purchasing the property. The money is deposited in an escrow account by the broker with the written understanding that if the buyers fail to make good on their offer to complete the purchase, the earnest money may be forfeited and disbursed to the sellers, compensating them for damage they may have suffered from taking the property off the market for a period of time -because "time is money." Sellers in Georgia can refuse to accept the ernest money and may sue for "specific performance" should a buyer fail to go forward on a contract. The law governing this deposit specifies conditions under which the buyers are entitled to have the earnest money refunded to them. Typically, this occurs when the sale fails for reasons outside the buyers' control.

When you decide to make an offer on a home, you will be required to make an "earnest money" deposit as proof that your offer is serious. Your earnest money will be deposited in your broker's escrow account -- not given to the seller -- and if the offer is accepted, your check will become part of your down payment or closing costs. If your offer is rejected, the broker will return your earnest money to you.

When you buy a home, your mortgage lender will expect you to pay a percentage of the sales price as a down payment. The higher your down payment, the lower your monthly mortgage payments will be. Your down payment will typically be 5% to 10% of the purchase price, which can be quite a chunk of cash. Don't panic -- there are many mortgage programs (see Finding the Right Mortgage) today which don't require as much as 5% down payment. Conventional and FHA loans may be as low as 3% down; VA requires NO money down; and the Georgia Housing Development Authority has a program for first-time buyers only (there are several qualifications) with as low as 1% down payment.

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