What type of deposit is typically made by investors purchasing single family residences at low prices?

The correct answer is based on the common practices within real estate transactions involving low-priced single-family residences. Investors typically make a deposit when purchasing such properties to demonstrate serious intent and commitment to the transaction. A $500 deposit is a standard figure that reflects a reasonable amount of earnest money in these situations.

This deposit amount balances the interests of both the buyer and seller, as it shows good faith from the buyer while remaining manageable for investors who may be looking to acquire properties at lower price points. Such amounts are often enough to secure the property temporarily while the transaction is finalized, without imposing an excessive financial burden on the buyer.

It is less common for these types of transactions to see deposits significantly lower or higher than this standard. Smaller deposits, like $250, may not provide adequate assurance to sellers, while a $1000 deposit could be seen as excessive when dealing with lower-priced properties. Additionally, the option indicating that no deposit is needed does not reflect the typical requirements in real estate transactions, as a deposit is generally expected to formalize the agreement.