What is Earnest Money?

 



What Is Earnest Money


What is earnest money and how does it work?

Earnest money is a deposit that is made by a homebuyer to demonstrate to the seller that they are serious about purchasing the property. 

The amount of earnest money can vary, but it is typically a small percentage of the purchase price.

When a homebuyer makes an offer on a property, they will typically include a check for the earnest money deposit along with the offer.

 If the seller accepts the offer, the earnest money will be held in escrow until the sale is complete. 

At that point, the earnest money will be applied to the purchase price of the home.

If the sale falls through, the disposition of the earnest money will depend on the terms of the purchase agreement.

 In some cases, the earnest money may be returned to the buyer, while in other cases it may be forfeited to the seller.

The purpose of earnest money is to provide the seller with some assurance that the buyer is serious about the purchase and to help protect the seller if the buyer backs out of the deal without a valid reason.


Jeff Miller
REALTOR
S.0197087
Berkshire Hathaway HomeServices Nevada Properties
www.HomesforNevada.com


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