You are here: Home Deposits Blog / Everything You Need to Know about Deposit Guarantees

Everything You Need to Know about Deposit Guarantees

everything you need to know about deposit guarantees
If you’re thinking about purchasing a house, property, or land, you probably already know that a cash deposit is required to guarantee the commitment of the buyer. These cash deposits are usually up to 5-10% of the purchase price which aren’t always available on hand to the buyer or the buyer would prefer those funds remain in their possession. This is when home or house Deposit Guarantees come in.

A house Deposit Guarantee can be used as a substitute for a cash deposit as the insurance that the buyer will pay the deposit and full purchase price at the point of settlement.

What are the benefits of a house Deposit Guarantee?

Now that you know what a deposit guarantee is, you’re probably asking yourself, “Why should I consider using a deposit guarantee? How do I decide between a cash deposit and a deposit guarantee?”

There are several reasons why a deposit guarantee might be the right route for you instead of a cash deposit:

  • When your equity is tied up in your existing equity
  • When your deposit money is tied up in your investments and your prefer not to cash them out
  • When you need a fast / INSTANT deposit
  • When you want to keep your line of credit free + clear and available for emergencies
  • When you want convenience, not bank visits and cheque pick up, drop offs and redepositing + waiting for funds to clear
How do house Deposit Guarantees work?

A buyer can apply for a Deposit Guarantee with Home Deposits Now and pay a one-time fee based on the deposit amount and the term required. Once the application is approved, the buyer will receive a certificate of deposit which can be given to the seller. The seller will then hold onto the certificate until the time of settlement and can only claim the Deposit Guarantee if the buyer does not fully pay the deposit by this time.

Are there risks to using a Deposit Guarantees?

Depending on the real estate agent or vendor, they may not always be familiar with house Deposit Guarantees. It’s best to speak with your real estate agent to avoid any misunderstandings.

House Deposit Guarantees can also be much cheaper than traditional loans, credit cards, or asset liquidation.

Click here to use our Fee Calculator which can provide you with a cost estimate instantly.

Do you have any questions? We would be happy to help! We’re available via phone, chat, or email!

We look forward to hearing from you.

Read More from our Blog

why homeowners are using deposit guarantees when selling

8 MIN READ

Why Homeowners are Using Deposit Guarantees When Selling

A house Deposit Guarantee can be used as a substitute for a cash deposit which acts as the insurance that the buyer will pay the deposit on closing. Deposit Gua...

/images/Blog/aron_truax.jpg

Aron Truax, CMO

POSTED 07 July, 2022

all about house deposits faqs and help for home buyers 2022

8 MIN READ

All About House Deposits: FAQs and Help for Home Buyers 2022

Frequently Asked Questions about Home and House Deposits

/images/Blog/leon_listes.jpg

Leon Listeš, Business Analyst

POSTED 05 July, 2022

5 things you need to know about house deposits in ontario 2022

7 MIN READ

5 Things You Need to Know About House Deposits in Ontario 20...

In 2022 house deposits can seem a little daunting at first, but we’re here to help!

/images/Blog/nathan_neyedly.jpg

Nathan Neyedly, Program Manager

POSTED 03 July, 2022

home deposits 101 can you borrow your house deposit

5 MIN READ

Home Deposits 101: Can You Borrow Your House Deposit?

When buying a home in Canada, the house deposit is usually between 5-10% of the purchase price of the property. Considering the current housing market, this is ...

/images/Blog/nathan_neyedly.jpg

Nathan Neyedly, Program Manager

POSTED 25 June, 2022

why should i use a deposit guarantee

8 MIN READ

Why Should I Use a Deposit Guarantee?

A house Deposit Guarantee can be used as a substitute for a cash deposit which acts as the insurance that the buyer will pay the deposit on closing. Deposit Gua...

/images/Blog/naresh_vyas.jpg

Naresh Vyas, VP Business Development

POSTED 22 June, 2022

home buyer help deposit guarantees

4 MIN READ

Home Buyer Help - Deposit Guarantees

Like the ones we offer here at Home Deposits Now, Deposit Guarantees first became popularized in Australia before coming to North America. Deposit Guarantees ar...

/images/Blog/annette_vais.jpg

Annette Vais, Business Dev. Manager

POSTED 15 June, 2022

why home buyers are leveraging deposit guarantees

3 MIN READ

Why Home Buyers are Leveraging Deposit Guarantees

When selling your house, you can state your preferred deposit amount and method in the listing. Deposit Guarantees have some massive advantages! Keep reading to...

/images/Blog/aron_truax.jpg

Aron Truax, CMO

POSTED 10 June, 2022

the next big thing in down payments on a house

5 MIN READ

The Next Big Thing in Down Payments On A House

For many, down payments on a house are the toughest part when it comes to buying a home. That, and qualifying for the mortgage.

/images/Blog/naresh_vyas.jpg

Naresh Vyas, VP Business Development

POSTED 05 June, 2022

home deposits 101 - canadian edition

8 MIN READ

Home Deposits 101 - Canadian Edition

Almost everyone has heard of a down payment when buying a house, but do you know about deposits? Many people confuse the two, but they’re very different! Here’s...

/images/Blog/nathan_neyedly.jpg

Nathan Neyedly, Program Manager

POSTED 01 June, 2022

how much is a house deposit in canada

3 MIN READ

How Much Is A House Deposit in Canada?

A house deposit, not to be confused with a down payment, is an offer of good faith which shows the seller that you are determined to purchase the property. To ...

/images/Blog/annette_vais.jpg

Annette Vais, Business Dev. Manager

POSTED 26 April, 2022