#14 - What's Earnest Money?
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. Normally the buyer’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 and closing costs.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. This will also be the case if the contingencies concerning financing, etc. cannot be met as set forth in the sales contract.
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. Normally the buyer’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 and closing costs.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. This will also be the case if the contingencies concerning financing, etc. cannot be met as set forth in the sales contract.
For all your Real Estate needs... Call
Mark W. Slagle, Owner/Broker
Twin Lakes Realty & Auction
865-382-1670
Office: 865-397-3540
Firm # 5270