The earnest money deposit is money that is placed into an escrow account. It is sort of like a security deposit. It informs the seller that the buyer is serious. This is required at the time a buyer makes an offer on real estate.
While this video addresses Realtors® on earnest money disputes, it’s good for both buyers and sellers to hear that the agent has no control directly when there is a dispute over earnest money.
How earnest money is handled is part of the contract. Most buyers will select for the earnest money deposit to be credited towards their down payment.
The earnest money deposit is placed into the escrow account within a few days of an accepted offer. The check will be cashed. There are terms in which cancellation will dictate the buyer receives their earnest money back.
Even though the contract may state the buyer receives their earnest money in full, without a seller’s signature, it can’t be released. This is important for the buyer to understand. If the seller doesn’t sign the release, escrow won’t release it to the buyer and mediation or court will typically follow.
A seller can also ask for the earnest money to be released to them after a certain date. A buyer should read their counteroffer carefully to see if this was something the seller asked for.
Earnest money should not be taken lightly. By definition: Earnest: resulting from or showing sincere and intense conviction.If you don’t intend to buy, don’t put earnest money on the table.
Find out more about Real Estate Transactions in Nevada by clicking the link or call Lori Ballen Team at 702-604-7739.