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When do you get your earnest money back?

Posted on March 9, 2018

While buying a new home in St. Louis is always an exciting proposition, it is also an expensive one. There is the matter of coming up with the down payment on the home, and then also having to put up earnest money to put the home you want under contract (your earnest money is typically applied towards your deposit when the deal closes). According to, in some cases, a seller can require that you offer as much as 10 percent of the purchase price in earnest money. That money is your financial commitment to doing what’s needed to buy the home and offers reassurance to justify the buyer taking it off the market. So when do you get it back?

Ideally, you will get the earnest money back when you close. Yet even in situations where the sale falls through, you may be entitled to recoup your earnest money. The most straightforward is when the seller decides to back out of the transaction. In this case, he or she must return the money to you. In others, however, you typically need to have contingencies in the contract that void the sale and entitle you to your earnest money. Such contingencies typically include:

  • When the house appraises lower than what it is listed for

  • When you discover a major flaw during the inspection

  • When a builder does not deliver a fully completed home

You may also ask for additional contingencies that protect you in the event that you are unable to secure financing or you cannot sell your current home.

A seller may ask you to waive all contingencies as a condition of the sale. In this case, you may need to compare the potential to losing your earnest money to the desire you have to buy the home.