What Is Earnest Money?

Finance
#1

Earnest money is a deposit given to a seller to show that the buyer is serious about purchasing a house. The funds provide the buyer more time to secure financing and complete title searches, appraisals, and inspections before closing. Earnest money is similar to a down payment on a house, an escrow deposit, or good faith money in many respects.

#2

Earnest money is the deposit you put down when you write an offer to purchase real estate. The purpose is to show that you are serious and are negotiating in good faith.

If the offer is accepted, this deposit becomes part of the purchase price. It will be held either by an attorney or the listing company/agent in an escrow account until closing of the transaction.