FAQ: What is Earnest Money?

Today’s question is “What is earnest money?”

This is money that is used to confirm a contract. This means that once we have a purchase agreement signed and accepted, we need to have a personal check or cash delivered to a listing broker to confirm that contract. That money is held in a trust account until we close the transaction. Those funds will be used towards the closing costs or down payment that a buyer is required at closing day.