Short Answer
Earnest money is a good faith deposit you make when your offer is accepted, showing the seller you are serious about buying the home. It typically ranges from 1% to 3% of the purchase price. In South Jersey, $1,000 to $5,000 is common for most price ranges. This money is held in escrow and applied to your down payment or closing costs at closing. You get it back if the deal falls through due to a contingency in your contract.
Earnest money is a deposit you make when your offer is accepted. It is held in a trust account by a title company, attorney, or escrow agent, not by the seller directly. The amount is negotiable, but in Burlington County, 1% to 2% of the offer price is standard. If your offer is accepted and you complete the purchase, the earnest money is credited toward your down payment or closing costs. If you back out of the deal for a reason not covered by a contingency, you may forfeit the earnest money to the seller. If the deal falls through because of a contingency you included, such as the inspection or financing contingency, you get your earnest money back. Your agent will explain how earnest money works in your specific contract and make sure it is protected.
Bob's Advice
Redfin Senior Agent · AI Certified Agent
Earnest money is a sign of good faith, not a gamble. As long as you include the right contingencies in your contract, your deposit is protected. I always make sure my clients understand what conditions would allow them to walk away with their earnest money intact. If you are worried about putting too much at risk, we can negotiate a lower amount. The key is working with a knowledgeable agent who structures your offer to protect your interests.
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