binder (redirected from Scultetus binder)
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A small amount of money
that a seller
requires a potential buyer
to deposit before a transaction
is completed. Earnest money ensures that the potential buyer is serious about the transaction and will be likely to complete it when the time comes. If the buyer subsequently withdraws from the deal, he/she usually forfeits the earnest money. It is common in real estate
(where it is usually called a good faith deposit
). Earnest money reduces the risk
to the seller. It is also called a binder.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
(1) Money given as earnest money for an oral contract to purchase real estate, to bind the parties until such time as they can complete the necessary written contract. (2) A written instrument giving immediate casualty coverage for property, even though the insured may not have paid a premium or received a policy.(3) A temporary contract of title insurance in which the insurer agrees to issue a final policy if certain exceptions, such as prior mortgage liens, are removed at or before closing.
The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.