Ever wonder what actually happens to your good-faith deposit once your offer gets accepted? Here’s the breakdown so you know exactly where your money is going and how it’s protected.
When you make an offer on a home, you’ll typically include what’s called a good-faith deposit—or earnest money—to show the seller you’re committed. It’s like putting skin in the game. This amount usually ranges from 1% to 3% of the purchase price, depending on where you’re shopping, the kind of home you want, and how competitive your offer needs to be. But here’s the key: that money doesn’t go to the seller. It’s held securely in a neutral escrow account and just sits there—untouched—until the deal closes.
Now, a lot of buyers worry they’ll lose that money, but in most cases, you won’t. If everything goes as planned, that deposit gets credited toward your total down payment or closing costs. It’s not extra money you’re spending—it’s part of what you were already planning to pay.
And if something causes the deal to fall apart—like an inspection that reveals serious issues, or your denied financing despite a contingency—your contract usually allows you to back out and get that deposit refunded, assuming those protections are still in place.
The bottom line? It’s a powerful tool to strengthen your offer, but it’s also designed to be fair and safe for you as a buyer. If you want me to walk you through exactly how much you’ll need for a good-faith deposit and how it’s protected, DM me “DEPOSIT” and I will walk you through the process.I’m Tanja Odzak, Realtor with eXp Realty. I help people sell and buy homes right here in the East Bay! With over $90 Million in homes sold and going on 10 years of experience, I know how to help you win in any market. I’m Tanja and I sell homes. Call me today and let’s get you going!
I’m a Top Producing Realtor® in the OAKLAND / BERKELEY / EAST BAY AREA. I’ve been in the San Francisco East Bay Area since I came up to do my undergrad at UC Berkeley (a long time ago!), with a short stint at UC Davis while getting my Master’s. I take my duties as a Realtor® and Fiduciary very seriously, I enjoy educating my sellers and buyers along the way. Putting People, Before Profit.
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