Earnest Money Deposit is a real estate term you will encounter when buying or selling a home in Ventura County. This page gives you a plain-English definition and explains why it matters.
What it means
The deposit is commonly around 1% to 3% of the purchase price in California, though the amount is negotiable. It is held by the neutral escrow holder, not the seller, and is credited toward the buyer's down payment and closing costs at closing. If the buyer cancels for a reason covered by an active contingency, the deposit is typically refundable; if the buyer breaches the contract, some or all of it may be at risk.
Why it matters to buyers and sellers in Ventura County
A strong earnest money deposit signals commitment and can strengthen a buyer's offer in a competitive Ventura County market. Buyers should understand exactly when their deposit becomes non-refundable, which is generally after contingencies are removed. Brian helps buyers structure deposits that compete without taking on unnecessary risk.
Frequently Asked Questions
How much earnest money is typical in California?
Often 1% to 3% of the purchase price, though it is negotiable and can be higher on competitive listings to make an offer stand out.
Is the earnest money deposit refundable?
Generally yes while a relevant contingency is still in place. Once contingencies are removed, the deposit is usually at risk if the buyer fails to close.
Where does the deposit go?
Into the neutral escrow account, not directly to the seller. It is applied to your down payment and closing costs at closing.
