Real Estate Articles for Sellers

Earnest Money Means You Are

In medieval days, a father would send an entire herd of cattle as a not-too-subtle hint that his daughter be married into a certain family. Nowadays, when you've decided a particular home is "the one" for you, you can, thankfully, leave the cattle at home. You are asked, however, to deposit a small percentage of the sales price of the home you want to purchase--it's called "earnest money."

Your earnest money is a good faith deposit that accompanies your offer. It is usually a personal check, but a short-term promissory note is sometimes acceptable. A sizeable earnest money deposit indicates financial strength and assures the seller of your commitment to purchase the property.

Once your offer is accepted, your earnest money check is cashed and deposited with the title company, attorney or with the listing broker. Your funds are held in a separate account reserved only for earnest money deposits. In most cases, everything proceeds smoothly to the closing day when the total amount of your earnest money is credited to you as a portion of your down payment.

If the sale doesn't go through, and you do not default on any of the contract's contingencies, your earnest money will be returned to you as soon as you and the seller sign an earnest money release.

If you're thinking of buying a home, give me a call. It would be a pleasure to assist you in finding "the one" that you'd like to call "home." My knowledge of today's real estate market will assist you in making wise decisions in every step of your transaction.

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This article is not intended to provide specific advice, but rather to provide insight into matters that we feel are useful. As always, seek professional advice prior to taking any action.

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