Shari Kruse

Managing Broker

 

 

 

 Real Estate:  An Expert's Advice

 KEEPING YOUR EARNEST MONEY SAFE

When you make an offer on a house, it is accompanied by an earnest money check.  Earnest money is intended to demonstrate that you are "in earnest" about purchasing property.  The earnest money check is made out to the listing company.  What happens to this check?

The party holding the check acts as an escrow agent until title transfer.  At that time you will receive credit for the amount of the check against your down payment and closing costs.  Real estate brokers are required by law to keep escrow  funds in a separate account that can't be used for any other expenses.  If you don't complete the transaction, the earnest money is dispersed according to the terms of the purchase and sale agreement.

If you default on your agreement, the earnest money may go to the seller, so be sure you understand all the terms and deadlines involved. 

Otherwise you may find yourself in breach of contract and end up forfeiting your deposit.  If you have any questions, be sure to ask!

If you would like to talk further about this topic, or if you have any questions about buying or selling real estate, please email me at sharikruse@pnwrealty.com or give me a call at 206-650-0871.

Published 6/28/06