Okuzeka
Real Estate vocabulary · Buying & Selling

Earnest money

Meaning in real estate, with examples

nounCommon term

In real estate, earnest money means: A deposit a buyer pays soon after an offer is accepted to show they are serious. It is usually held by a third party and counted toward the price at closing.

In Turkish: kaparo, kapora, pey akçesi

How it is used

American English, also called a good faith deposit. The money is usually kept in an escrow account. If the buyer pulls out without a valid contingency, the seller may be entitled to keep it.

Example sentences

  1. We put down 10,000 dollars in earnest money when the seller accepted our offer.

  2. The earnest money will be credited toward your down payment at closing.

Common collocations

  • earnest money deposit
  • put down earnest money
  • lose the earnest money
  • hold earnest money in escrow
  • escrowAn arrangement in which a neutral third party holds money or documents until all the conditions of a deal are met, then releases them to the right person.
  • down paymentThe part of the purchase price a buyer pays with their own money at the start, while the rest is usually covered by a mortgage.
  • contingencyA condition in a purchase contract that must be met before the sale can go ahead, such as the buyer getting a mortgage or a good inspection report.
  • purchase agreementA written contract between buyer and seller that sets out the price, conditions and dates of a property sale before ownership is transferred.

More terms: Buying & Selling

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