I would first look at the earnest money given at the time of the offer. I wouldn't worry about the down if the buyer is pre-approved. I have not sold to a no down buyer, but my last sale, the buyer have 50% of sale price invested (I saw the statements), they were only putting 20% down, came in with a pre-approval, so I didn't worry.
I too, would worry if they were giving a small deposit, with no or low down. But if you have no other offers, is may be worth it to you.

by downpayment do you mean money given at contract signing or closing? I am buying a house where i put down a little less than 3% at the time of contract but will put down 20% at closing. I think it depends on the amount the house is for sale. Like if 3% is only a few thousand dollars it might be easier to walk away from it as opposed to tens of thousands of dollars.

Thanks for the responses. By downpayment I'm thinking of both. I want the amount of "earnest" money at contract signing to be something a buyer wouldn't walk away from easily (I've heard horror stories of buyers who put down a very small amount and then are willing to leave it on the table when they change there mind after contracts are signed). I'm also concerned about the overall downpayment in the sense of how much do I need to worry about a potential buyer that's going for a 95% or more mortgage?

The earnest money is probably the one that should concern you. The downpayment is between the buyer and his bank. I have never know what the financial arrangements of the buyers have been, as long as the bank gives us the "thumbs up" sign for them. However, the buyer can invoke any contingency on the contract and get his earnest money back. We had a buyer cancel today, and he had put down $10,000 earnest money with $1000 non-refundable to him. He invoked the inspection contingency, even though the report was pretty clean.

For earnest money, An easy way to figure it out is to decide how much it's worth to you to take the house off the market temporarily. I've heard lately people getting their deposits back after changing their mind before closing anyway.

If it were me, I'd not be too concerned about the amount of either to tell you the truth as long as I get them to the closing in 2-3 weeks. I'm more concerned with getting it over with and it's not over til the closing.

The down payment should be irrelevent to you. In fact I don't see how you would even know what the down payment is. Like stated earlier that's between the buyer and the bank. As long as the buyer is pre-approved it's really of no concern to a seller how it's financed.

edenbojr:
As long as the buyer is pre-approved it's really of no concern to a seller how it's financed.

I disagree. I would be concerned if a buyer put $1000 down with a PA letter and were going to finance 100% or use creative or sub-prime financing. To me, that would smell of not being able to afford the house if they have to finance the whole thing and that getting to closing could be a problem if they have to use such financing.

For me, financing is the most important aspect of the deal.

We had an offer on the first showing of our house in Flagstaff. It was a guy transferred by the Railroad. He had a PA letter with the amount for which he qualified, but he was also financing 100%. My gut told me to flat out refuse (because he also majorly lowballed in a strong seller's market), but our realtor suggested we counter at full asking, which we did. The guy didn't counter back.

Besides, doesn't a PA letter mean nothing anyway? It's not until the buyer provides a letter of commitment from the bank that proves the financing is in place. Even then, something can happen prior to closing if the buyer didn't disclose a debt that the bank discovers. It happens all the time.

$2,500 is the standard money put in escrow here. Otherwise, anything having to deal with the actual financing of the house is not discussed between the buyer and seller. It just isn't done. It would be like asking someone how much they make a year. It hits the "rude" catagory. So, the answer is really dependent upon the way business in done in your area. If a seller asked me how much I was going to put down for the mortgage, I would tell them that is none of their business.

Gloria

I thought I posted another response but I think it didn't go through. The way it's done here, the seller knows exactly how much the buyer is putting down--it is all spelled out right in the offer. The downpayment is put down in three parts--one part at offer acceptance, one part at contracts and the rest at closing.

The down payment is very relevant to me as a seller. A buyer who is putting little or no money down at offer and contract can easily walk away from the deal at any point without too much damage. I also agree with the other poster who mentioned the concern about "creative financing". The preapproval letter provides some piece of mind but it's no guarantee.

I think you're using the wrong term.

"down payment" means the amount paid to the BANK in advance for the LOAN.

The DEPOSIT, or the EARNEST MONEY, is perhaps what you mean? Bcs "at offer acceptance" doesn't involve the bank yet, so this can't be what you mean. They perhaps pay a DEPOSIT or EARNEST money to the seller, to justify the risk of taking the home off the market.

Also "at contracts," the bank may not be involved yet; this payment is, I assume, a continuing payment of deposit to show the good faith of the buyer.

Only AT CONTRACT would a buyer give any money to a bank--at the same point at which he borrows the rest.

Maybe it is the wrong term, but they way it's been explained to me is that these monies are all percentages of the ultimate down payment. The money at offer and at contract go into escrow until the closing and then is part of the total down payment. The seller doesn't have access to any of this money (earnest, deposit) before closing.

But buyme, it doesn't manner if earnest (deporit) money goes into a down payment ultimately or not. The seller gets paid at closing. That's all you need to know.

I gather that the customary amount of earnest money varies depending on where you live. Where I am, 1k is the usual, because everyone has Home Inspection and Financing contingencies, so they can usually find justification to get out of their contract and get their money back anyway.

"Only AT CONTRACT would a buyer give any money to a bank--at the same point at which he borrows the rest."

No, at settlement (AKA close of escrow).
Keep in mind that NY does a lot of things very different than most of the country.

The most common method is prepare offer (a contract signed by the buyer only) and submit to seller.
Seller can accept offer, or modify and create a counter offer.
Repeat as required to each party has signed the offer without any changes.
You now have a binding contract.
The contract may include certain deadlines for various activities like inspections.
The typical wording is that 'the buyer has X days to obtain an inspection.' If the deadline is not met, the inspection is waived.
Some contracts further define how inspection issues will be handled down to specifying times for each party to respond or the contract is void.

A few places have state defined 'attorney review' periods, but that is not the most common.
You offer, they accept, contract is done.

Ny has a bunch of games before then actual written contract is prepared by an attorney, then more gaming whiling everyone reviews, than finally an actual contract.

Money proffered with an offer is earnest money, and the amount varies greatly.
Starter homes may have a few thousand at most.
More expensive homes may get up to 10% of the purchase offer.
This money is the damages the seller can (try) and keep if the buyer fails to perform.
At the settlement table the ownership of the property is actually conveyed (deed is executed) and the sellers portion is pretty much over. In a wet settlement the seller will walk away with a check (or the money will be wired to them by the escrow agent). In a dry settlement the money follows within a few days. Some states require wet settlements (Virginia is one, along with New Hampshire)
The buyer then turns the property over to the lender through a deed of trust or encumbers it with a mortgage.

The down payment is the cash the buyer offers the lender to obtain a loan.
Lenders are leery of lending the entire purchase price. They would like some additional security the buyer will not default. There are loans for 100% of the purchase price, and anything less than 20% down will need either PMI or someone else to assume some risk (like a second mortgage holder). FHA and VA will go 100% but FHA has MMI.
How much the buyer is putting down is of little interest to the seller.
The seller is paid the contract price from some combination of lender and buyer funds.
As long as the person can qualify for the mortgage the rest is there problem.
A buyer with a lot of cash who wants a property may put down more earnest money to entice a seller to sign the offer, but the money held until settlement by the RE broker or settlement agent. The seller does not get constructive possession of the money till the sale is completed.

sorry, sorry--I am getting *MY* same-letter-starting terms mixed up. I meant only at CLOSING does the buyer give money to the bank they'll have the loan with.