Silver Spring, MD Home Buyer FAQ: will I get my deposit back?

Real Estate Agent with Thompson Company, REALTORS® MD594797

Buying a home in Silver Spring, MD and beyond - FAQ:

Will I get my earnest money deposit back if my offer is not accepted? 


Dreamhouse in Silver Spring, MD and beyondBefore I answer this question, let's quickly review what the earnest money deposit actually is. When you put in an offer on a property in Silver Spring, MD and beyond you will have to provide details about your earnest money deposit - on the very first page of the Residential Contract of Sale. The earnest money is expressing your commitment to the seller and is a show of good faith. It communicates that you are ready and able (in combination with a loan pre-approval) to buy and are also willing to accept some risk.

Although there is no law telling you how high your earnest money should be, there are customs & expectations. In Silver Spring, MD and beyond, 1% of the sales price is a good rule of thumb to go by. Keep in mind, however, that a competitive market may call for more. In that case, a higher earnest money deposit can give you the edge. Rounding down a bit can also be acceptable in a slower market, when there is no competition from other buyers that is. What I not suggest doing is to low-ball it. All a $1,000 deposit on a 500K house will communicate to a seller is that you don't really care about the house and may not be very serious about buying and, perhaps, bail when you get the chance. Losing 1K is a lot less painful than losing 5 or 10K after all. 

It's important to point out that you are not actually giving the seller your earnest money when the offer is submitted - your cash does not end up in the seller's house, nor the listing agent's pocket, it actually stays in your bank account for the time being. What you do submit is a copy of a check or proof of funds if you intend to wire the money. Only when the seller and you have come to an agreement and the contract has been ratified will you hand over the check (or initiate the bank transfer). Depending on the terms of the contract, your earnest money will either be held in a a non-interest bearing (typically) escrow account by your buyer's broker or the title company (that you choose). In Silver Spring, MD and beyond the check must be collected within 3 days if held by the broker and put into escrow within 7 days. 

Back to the original FAQ: will I get my earnest money deposit back if my offer is not accepted? 

As long as you are in the offering stage - including negotiations back and forth - your money is still in your bank account. You may have already handed over the check but your buyer's agent/broker is holding on to it. Therefore, should you not come to a mutually acceptable agreement with the seller, you will not make a deposit, and your check will be returned to you or you can shred it - unless of course, you decide to quickly submit an offer on a different home. 

Could your deposit be at risk and could you actually lose it? That is a different question and one that I have answered previously. You can find more Silver Spring, MD Home Buyer FAQs here

Posted by







Thompson Company, REALTORS
16910 Oak Hill Rd, Silver Spring, MD 20905
o: (301) 384-9177 c: (240)593-2860

Andrea is a REALTOR® based in Silver Spring, MD. She has enjoyed assisting buyers and sellers since 2004 and focuses on residential Real Estate in  Montgomery and Howard County, MD. Andrea is a proud mom and hobby decorator with a vintage soul. She always answers the phone with a smile, enjoys running and treasure hunting and is addicted to coffee.


 All photographs are my own and I'd like to keep it that way. All information is deemed reliable but not guaranteed.




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Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

Hi Andrea: When the first question out of a buyer's mouth is will I lose my deposit, it makes me wonder just how committed are they to this transaction?

Mar 05, 2019 08:46 PM #1
Brian England
Arizona Focus Realty - Gilbert, AZ
MBA, GRI, REALTOR® Real Estate in East Valley AZ

People always want to know this, money at risk will always be a concern.  As long as they hire the right agent to represent them, there is very little risk involved.

Mar 06, 2019 06:04 AM #2
Andrea Bedard
Thompson Company, REALTORS® - Silver Spring, MD
M.A.; REALTOR® Silver Spring, MD and beyond

Hi Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, although I've met a few buyers where I wondered, too, I find that, more often or not, buyers don't always know what the earnest money is, confuse it with the down payment at times and generally just need to hear how it works. When will they have to transfer the money, from savings to checking or similar, when and how is it applied? What happens when the contract falls apart? Anything about the earnest money is one of the FAQ I get asked the most, and I'm happy to explain 

And it should be Brian England. I like my buyers to become very knowledgeable, therefore comfortable with the entire process, and don't leave a question unanswered. 

Mar 06, 2019 07:20 AM #3
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Andrea Bedard

M.A.; REALTOR® Silver Spring, MD and beyond
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