Close

Sarah Hanif

ALHS
  5.00/5 View Ratings
Keller Williams Realty Southwest
< BACK Subscribe

What is Earnest Money?

November 18th, 2020



When a property is purchased, along with the executed contract, buyer is to pay EM and Option check. 
Checklist for purchasing/selling a home include:
1. Negotiate the home and execute a contract
2. Turn in Earnest Money (EM) to title company and Option Period Check to the sellers
3. Get Option Period Check and EM receipted
4. Schedule inspections within the Option Period (OP) 
5. Submit executed contract and receipted items to title company and lender (if financed deal)
What is Earnest Money? 
An earnest money deposit is shown to the seller of the home from the buyer as a way to ensure the seller knows the buyer is serious about wanting and purchasing the property. It is also called a “Good faith deposit”, it is helpful to build trust with the seller. Your Earnest Money is credited back to you at closing. 
Understanding Earnest Money
If an offer is made, both parties enter into a contract. The deposit is helpful to build trust with the seller.  This contract contains provisions about how you’re going to increase your commitment level as you move through the buying process.
How much is the deposit? 
Earnest money deposits are usually 1 percent of a home’s purchase price, depending on local market. 
Is the Earnest Money Refundable?
Often your deposit is tied to other provisions of your contract, your deposit is refundable during your protection (or contingency) period, but after you release certain contingencies, the deposit may become harder to recover.

Join the discussion

To post a comment on this blog post, you must be an HAR Account subscriber, or a member of HAR. If you are an HAR Account subscriber or a member of HAR, please click here to login. If you would like to create an HAR Account account, please click here.

Login to Comment
Disclaimer : The views and opinions expressed in this blog are those of the author and do not necessarily reflect the official policy or position of the Houston Association of REALTORS®

Join My Blog

Your Neighborhood Source
Keller Williams Realty Southwest
1650 US Highway 6 Suite#350, Sugar Land, TX 77478   Get Directions
Phone: (281) 265-0000
Fax: (281) 265-0123
  • Archive
    •     2020
    •     2019