You found a home in Buford you love. Now your agent is talking about earnest money and deadlines. It can feel like a lot at once, especially when you are juggling inspections, loan prep, and moving plans. The good news is you can handle this with confidence when you know the typical amounts, the timing in Georgia contracts, and how refunds work if things change.
In this guide, you will learn what earnest money is, how much buyers in Buford usually offer, when it is due under common Georgia terms, and how it is held and released. You will also get checklists for buyers and sellers and a simple timeline you can follow. Let’s dive in.
Earnest money basics
Earnest money is the buyer’s good‑faith deposit that shows commitment when you make an offer. It signals to the seller that you intend to move forward while inspections, loan approval, and title work happen. If the deal closes, the deposit is applied to your closing funds.
The contract names who will hold the funds and how they will be handled. If a buyer defaults outside the contract’s protections, the seller may have a remedy to keep the deposit as liquidated damages, depending on the agreement. If the seller breaches, the buyer can usually recover the deposit.
How much to offer in Buford
There is no fixed amount required by law. The earnest money you offer is a negotiable term of your contract and should match market conditions and your strategy.
- In a balanced market, a common starting point is about 1% of the purchase price.
- In a competitive or multiple‑offer situation, buyers often offer 2% to 3% or a flat amount like 5,000 to 10,000 dollars, sometimes higher, to stand out.
- For lower‑priced homes and some condos or townhomes, deposits can be a few hundred to a few thousand dollars, depending on price and competition.
Your financing can also shape your approach. Cash buyers sometimes offer a larger deposit to strengthen an offer. If you are using a loan, be sure your contingency protection aligns with the amount you put at risk.
When earnest money is due in Georgia
Georgia purchase contracts set the deadline for delivery, so always check the exact wording in your signed agreement. Georgia Association of REALTORS forms are widely used, and they commonly require the buyer to deliver the deposit within a short window after the contract is accepted. A frequent timeline is within three business days, though you may see 48 hours, five business days, or another agreed period.
Here is a simple example: If your offer is accepted on Monday and your contract says three business days, the deposit is typically due by Thursday. The contract will also name the escrow holder who should receive the funds.
Timing matters. Late delivery can be a breach unless the seller agrees to accept funds after the deadline. The deposit date can also influence how other deadlines are tracked, so record it carefully and get a receipt.
Who holds the funds
Your contract will name one escrow holder. In Buford and greater Gwinnett transactions, that is often:
- A broker’s trust account, either the listing broker or the buyer’s broker
- A title or settlement company
- A real estate attorney’s trust account
Escrow holders must follow written instructions in the contract and applicable trust‑account rules. If there is a dispute about who should receive the money, the escrow holder will look to the contract and may require a written agreement between the parties or interplead the funds into court.
When deposits are refundable
Earnest money is generally refundable to the buyer when the buyer follows the contract’s rules and terminates within allowed periods. Common examples include:
- Inspection contingency: You end the contract within the inspection window and give proper notice.
- Financing or loan approval: You cannot obtain loan approval within the timeline and you terminate as required.
- Appraisal contingency: The appraisal does not support the price and you terminate within the allowed period.
- Seller breach: The seller fails to meet obligations under the agreement.
Always follow the notice method and deadlines written in your contract to preserve your refund rights.
When you could forfeit earnest money
You may lose your deposit if you default or terminate outside your contract’s protections. Examples include:
- You miss contingency deadlines or remove contingencies, then back out without a permitted reason.
- You fail to deliver the deposit on time and the seller enforces the contract.
- You default for reasons not covered by your contingencies and your contract allows the seller to keep the deposit as liquidated damages.
Your risk level rises if you waive contingencies or shorten them too far. Balance offer strength with sensible protections.
Buyer checklist before you deposit
Use this quick list to stay on track:
- Confirm the escrow holder and deposit deadline exactly as written in your ratified contract.
- Choose an amount that matches market conditions and your contingency safety net.
- Decide your payment method, then prepare funds. If wiring, verify instructions using a trusted phone number.
- Deliver funds before the deadline and obtain a written receipt or confirmation.
- Set calendar alerts for your inspection, appraisal, and loan commitment dates.
Seller tips to safeguard the deal
As a seller, you can protect your timeline and leverage by tightening the details up front:
- Confirm the deposit amount, escrow holder, and delivery deadline in the signed contract.
- Decide whether you want a liquidated damages option for buyer default. Ask your agent about the implications and consult an attorney if needed.
- Track the buyer’s deposit timing. If funds are late, ask your agent about your options so you can pivot to backup plans.
Example timeline for Buford buyers
This sample shows common timing under Georgia practice. Your actual dates may vary by contract.
- Day 0: Offer accepted and contract ratified.
- Day 0 to 3 business days: Buyer delivers earnest money to the named escrow holder.
- Day 7 to 10: Typical inspection window, if included.
- Day 21 to 30: Common loan commitment deadline, if financing.
- Closing: Often 30 to 45 days from ratification, depending on your loan and title work.
If a dispute arises
Start by reviewing your contract’s escrow and disbursement clause. Many contracts outline how the escrow holder must proceed and what documentation they need to release funds.
If you and the other party agree in writing, the escrow holder can release the deposit accordingly. If there is no agreement, the escrow holder may interplead the funds with a court so a judge can decide. Some contracts also call for mediation or arbitration. For larger deposits or unclear language, consider speaking with a real estate attorney.
Safeguards for wiring and escrow
Protect your funds with a few simple steps:
- Independently verify wiring instructions by calling the escrow holder using a trusted, known phone number.
- Avoid sending account details over unverified email. Confirm changes by phone.
- Keep copies of checks, wire confirmations, and receipts in one safe place.
- Ask the escrow holder about their written procedures for handling and releasing funds.
Bringing it all together
Your earnest money tells the seller you are serious, and it becomes part of your closing funds if all goes to plan. In Buford, most buyers start near 1% of price, then adjust based on competition and their contingency protections. The key is to know your deadlines, deliver on time, and keep clean records from offer to close.
If you want a clear plan for your Buford purchase or sale, reach out for guidance that blends market insight with disciplined negotiation. Connect with Amy Scott to walk through your contract terms, deposit strategy, and timeline with confidence.
FAQs
How much earnest money is typical for Buford home purchases?
- Many buyers start around 1% of the purchase price. In multiple‑offer situations, 2% to 3% or a strong flat amount like 5,000 to 10,000 dollars is common.
When is earnest money due in Georgia contracts?
- Many Georgia contracts require delivery within a short window after acceptance, often three business days, though your signed agreement controls the exact timeline.
Who usually holds earnest money in Buford transactions?
- Funds are commonly held by the listing or buyer broker’s trust account, a title or settlement company, or a real estate attorney’s trust account, as named in the contract.
When can a buyer get earnest money back?
- Buyers typically receive a refund if they terminate within contingency periods, follow notice rules, or if the seller breaches the contract.
When might a seller keep the earnest money deposit?
- If a buyer defaults or cancels outside allowed contract protections, many agreements permit the seller to keep the deposit as liquidated damages.
Does a cash offer change earnest money strategy?
- Cash offers often include larger deposits to signal strength, but with no loan contingency the buyer’s risk is higher, so balance deposit size with other protections.
