Earnest money
What is earnest money? Explained in English and Spanish
Earnest money is the good-faith deposit the buyer delivers after signing the contract. The title or escrow company holds it, and at closing it is credited toward the down payment or closing costs.
When is it due?
A few days after the effective date: within 3 days in Texas, 3 business days in California, and the initial deposit in Florida is commonly due within 3 days. Use the free calculator to get the exact date.
When is it refunded or lost?
If the buyer terminates within a contingency and on time, it is usually refunded. If the buyer defaults or misses a deadline, the seller may keep it – which is why late or missed deadlines are the most expensive mistake in a transaction.
Send it in Spanish
The same explanation for a Spanish-speaking buyer or seller – copy and send:
El “earnest money” es el depósito de garantía —también llamado dinero de buena fe— que el comprador entrega después de firmar el contrato para mostrar que va en serio. Lo guarda la compañía de títulos o de escrow y, en el cierre, se descuenta del pago inicial o de los costos.
Calculate the deadlines: Real estate contract timeline calculator
General explanation, not legal advice and not a translation of the contract. The signed contract and the law of the state where the property is located govern.
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