Earnest money shows you’re serious
Typically when an offer to purchase a house is made, you, as the buyer, will deposit a sum of money to be held in an escrow account if the seller accepts your offer. This deposit shows the seller that you’re serious about the offer to purchase the property.
The amount of earnest money deposit varies based on the type of property being purchased and local market conditions. As your real estate professionals, we will help you determine the appropriate amount to place in escrow as an earnest money deposit. Typical earnest money in the Sarasota-Bradenton market is from 2.5%-5% of Sales Price, however each offer is unique and could fall outside these common parameters.
The sales contract will dictate who holds the earnest money. Usually the seller’s real estate agent will deposit the earnest money in a trust or escrow account until closing. At closing, the earnest money is applied to the purchase price on behalf of the buyer.
In the event the sale doesn’t close, the sales agreement generally spells out what happens with the earnest money based on why the transaction did not close. Generally if the seller meets all the terms of the contract, and the buyer has defaulted, the seller will keep the earnest money. If the seller does not meet the terms of the contract and has defaulted, you, the buyer, may receive a total or partial refund of the earnest money.