The Earnest Money Deposit, aka EMD.
This is a deposit, sometimes referred to as a good-faith deposit, that goes toward the purchase of a real estate transaction. It's to show that you are "serious" about purchasing the property.
EMD amounts:
- Under $100k purchase price - $500.
- Over $100k purchase price - $1000.
- $200k and above - 1% of the purchase price.
- Earnest Money Deposits can vary and change during negotiations.
When the seller accepts the offer, the deposit will be deposited into an escrow account by the Broker*. The money will be applied to the buyers closing costs and/or purchase price at closing. If the offer is rejected, the EMD will be returned to the buyers.
A copy of the EMD will be given with the Purchase Agreement.
*The EMD must be deposited by the Broker within 48 hours by state law. Please make sure you have the money in your account (if paying by check) or have a certified check.
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