Earnest money when is check cashed

The real estate agent might hold the check until the seller accepts the offer and then give the check to the title company. Earnest money is funds the buyer offers to the seller to show good faith when making a real estate purchase offer. The amount of the actual earnest money varies according to what the seller is willing to accept. Earnest money typically goes toward the purchase price, yet if the buyer cancels the purchase offer, she risks losing the earnest money to the seller.

The terms of the purchase contract dictate when the buyer loses the earnest deposit should the sale fail to close. For example, if a purchase contract is contingent on the property appraising for a certain amount and fails to appraise, the buyer normally gets her earnest deposit back should she cancel on the grounds of the low appraisal amount.

Serious Home Buyers Should Know Earnest money is a deposit towards the purchase of real estate from a buyer to show the seller they are serious about wanting to purchase the home and will hold up their end of the purchase agreement. When paying earnest money do not pay with cash.

Your lender will need to verify the earnest money. The best way is to pay via personal check. When is the earnest money check cashed? Once your offer is accepted, the earnest money check is usually deposited into an escrow account, where it is held until closing. That money is collateral that guarantees your promise to purchase the house. But once an offer is accepted, what happens with said earnest money?

Does it sit in limbo as you wait for the sale to close, or will your check be cashed while the transaction proceeds?

Once your offer has been accepted—but before the close—you give the seller a check for the agreed-upon amount.