Houtan HormozianExpert on Real Estate, Finance and PropTech

What Is Earnest Money? A Simple Explanation for Homebuyers

2 Jul 2026 · 0 min

Watch on YouTube

0:25

In this brief explainer, the speaker defines earnest money as a good‑faith deposit that signals a homebuyer’s seriousness to the seller. The video explains that when a purchase closes, the earnest money is typically credited toward the buyer’s down payment or closing costs. It also clarifies that if the transaction falls through, the refund of the deposit depends on the specific contract language and any contingencies that were included, such as financing or inspection clauses. The segment ends with a call‑to‑action inviting viewers to call for further home‑buying assistance.

If you're buying a home, you've probably heard the term earnest money. It's basically a good faith deposit that shows the seller you're serious about buying the property. If everything goes through, that money usually gets applied toward your down payment or closing costs. If the deal doesn't close, whether you get it back depends on the terms of your contract and any contingencies that were included. Have questions about buying a home? Give us a call. We're here to help. Thank you.