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Trulia Orlan…, Other/Just Looking in Orlando, FL

What is earnest money and how do I know how much to set aside?

Asked by Trulia Orlando, Orlando, FL Wed Oct 24, 2012

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Bob's answer may be correct for where ever zip code 21114 is, but it does not reflect the market (or indeed the law) here. It is not common for you to have to write out a check to make an offer. Given the legal requirements and agent/broker liabilities, there are very few buyer's agents I know who would ever take a check from a buyer these days. Here it is normal to wire the escrow deposit to the closing company within 2 or 3 days of the contract being signed by both sides.
1 vote Thank Flag Link Thu Oct 25, 2012
Great info Bob - thanks
We are hoping to sell in CT and goto FL
our neighbors are snowbirds! Naples and Sarasota --
Flag Sat Oct 27, 2012
Earnest money is the check you write when you make an offer to purchase property, to show your are "earnest" in your offer. It is held in escrow, until the terms of the contract have been met.

Margaret Hassani
Broker, Lightning Realty
Phone/Text: (813) 766-1501
Email: Marg@tampahouse1.com
Website: http://www.TampaHouse1.com
1 vote Thank Flag Link Tue Oct 30, 2012
Earnest Money can be looked at your "skin in the game" or how much you are willing to part with should you default on your purchase agreement. You will know how much to set aside based on what is stated in your purchase and sale contract. Hopefully you are working with a great exclusive buyer's agent that is looking out for your interests.
1 vote Thank Flag Link Sat Oct 27, 2012
Some call it Ernest Money - some call it Deposit - some call it Escrow
It's usually 2% to 5% plus or minus
1 vote Thank Flag Link Sat Oct 27, 2012
Best to engage a local Real Estate Broker right away by clicking "Find a Pro" in the green menu bar above. http://www.naplesrealestateguys.com/
1 vote Thank Flag Link Thu Oct 25, 2012

As you can see below is the answer as to what an earnest money deposit is. I have an extensive buyers package I can send to you that explains the entire process inculding earnest money deposits from a-z. Email me and I will send it over to you.

Jennifer Barker
Exit Realty Central
1 vote Thank Flag Link Wed Oct 24, 2012
Earnest Money Deposit (EMD) is just what it says. It is simply something of value indicating you are making an offer in "Earnest". What that amount is depends on the seller and buyer. It could be $1 or $100,000.

There is no legal requirement as to how much one needs to use. It is a form of goodwill for performance, so in essence it could be a Picaso or a car (that is why the Contract has an "other" section). There may be holding requirements for these other deposit types.

So the answer is that it is a subjective and completely negotiable matter.

Now an agents involvement with a deposit has laws of containment in the handling, but is also a broker by broker decision as to whether they choose to hold escrows.

I do not hold escrows in account so my instructions are for delivery within the lawful timelines to the agreed upon title company.

Escrow disputes account for most agent discipline actions with the FREC.

I included a State Of Florida DBPR document in PDF form that has many rules covered below.

Don Johnson
Permitted Real Estate School Instructor

MORE Realty Services LLC
Lic. Real Estate Broker
0 votes Thank Flag Link Thu Mar 21, 2013
on the real estate test , how much $ require for earnest $ . a $ 0 b $ 1 c $ 500 d $ 1000
0 votes Thank Flag Link Sat Mar 9, 2013
what % of earniest $ require or if any require?
0 votes Thank Flag Link Sat Mar 9, 2013
Bob could not have explained it better.
0 votes Thank Flag Link Wed Oct 24, 2012
An earnest money deposit is when you put money down on a house in good faith. In other words, you're putting down a certain amount of money and saying to the seller that you want to purchase this home and the seller is taking the house off of the market and will let you and only you purchase the home. An earnest money deposit is given once you write up the offer and is cashed when both parties sign the offer which then becomes a contract. If you don't follow through and purchase the home you will lose your earnest money deposit. In regards to how much money to put down, that is negotiable between the buyer and the seller but is usually 1% - 5% of the purchase price.
0 votes Thank Flag Link Wed Oct 24, 2012
0 votes Thank Flag Link Wed Oct 24, 2012
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