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A competitive market might mean you’ll need to put down more money. Most agents agree that buyers should include an earnest money amount that will be taken seriously, but not so much that a buyer’s finances are at risk. It’s unlikely that you’ll lose your earnest money deposit, but it’s important to protect yourself.
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· If you are truly referring to the earnest deposit, which is the initial deposit you put down when you get into contract for a house, generally the buyer receives the deposit back if: 1) Loan contingency has not been removed yet, 2) Appraisal contingency has not yet been removed, 3) Inspection contingency has not been removed yet.
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Upon the close of escrow, the earnest money deposit is applied to the balance of the down payment. Like price and terms, the deposit amount is negotiable. But if you put in much less than what’s customary in your market, it won’t fare well with the seller – particularly in a competitive market.