Earnest
money shows you’re serious!
Typically when an offer to purchase
a house is made, you, as the buyer, will
also pay an “earnest money” deposit. This
deposit shows the seller that you’re serious
about the offer to purchase the property.
The amount
of earnest money deposit varies based on the
type of property being purchased and local
market conditions. As your real estate
professional, I’ll help you determine the
appropriate amount to pay as an earnest
money deposit.
The sales
contract will dictate who holds the earnest
money. Usually the seller’s real estate
agent will deposit the earnest money in a
trust or escrow account until closing. At
closing, the earnest money is applied to the
purchase price.
In the
event the sale doesn’t close, the sales
agreement generally spells out the
conditions under which you would forfeit the
earnest money. Generally if the seller
meets all the terms of the contract, the
seller will keep the earnest money. If the
seller does not meet the terms of the
contract, you, as the buyer, may receive a
total or partial refund of the earnest
money.
