The amount of earnest money deposited varies based on the type of property being purchased and local market conditions. In a seller’s market it makes more sense to put down a larger ‘good faith’ deposit to attract the seller to the offer. In a buyer’s market a large earnest money deposit may convince a seller to agree to a lower purchase price. As your real estate professional in the Winston Salem, Clemmons, Lewisville, Buena Vista, Advance, Lewisville, Pfafftown, Bermuda Run, N.C. area, I, at Homes and Acres, will 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.

The sales agreement generally spells out the conditions under which you would forfeit the earnest money in the event that the sale doesn’t close. 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.