{"id":52791,"date":"2024-05-29T17:55:39","date_gmt":"2024-05-30T00:55:39","guid":{"rendered":"https:\/\/www.movoto.com\/blog\/?p=52791"},"modified":"2026-10-22T12:10:25","modified_gmt":"2026-10-22T19:10:25","slug":"earnest-money-deposit","status":"publish","type":"post","link":"https:\/\/www.movoto.com\/blog\/earnest-money-deposit\/","title":{"rendered":"What is an Earnest Money Deposit?"},"content":{"rendered":"

An earnest money deposit (EMD) is the \u2018good faith deposit\u2019 you put down in closing to prove you are a serious buyer. <\/span><\/p>\n

This deposit is given when the house is taken off the market for the intended sale and stays in escrow until the close. <\/span><\/p>\n

As a purchase agreement can take time to process, earnest money ensures that the seller won\u2019t experience a total loss should the contract fall through. There are conditions where this deposit can be credited back to the buyer if the deal doesn\u2019t go ahead, otherwise, the seller may keep the funds.\u00a0<\/span><\/p>\n

Key Takeaways<\/h2>\n
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  1. Earnest money can help boost your chances of getting a house.<\/li>\n
  2. Earnest money is usually 1% to 3% of the sale price.<\/li>\n
  3. If the deal goes forward, earnest money can generally go toward your down payment.<\/li>\n<\/ol>\n

    Is it Normal to Have an Agent Suggest an EMD in Your Offer?<\/span><\/h2>\n

    Earnest money is a common part of the homebuying proces<\/a>s, especially in a buyers market. It discourages a buyer from making multiple offers, which is a concern for sellers in a competitive market. <\/span><\/p>\n

    A real estate agent may even recommend putting down a higher EMD to increase chances of getting the house. Earnest money also is helpful for the buyer as it gives them time to pull together the rest of the funding as well as perform routine inspections.\u00a0<\/span><\/p>\n