What if a simple deposit could make or break your Bellevue offer? When you are buying a home on the Eastside, earnest money is a small part of your cash that carries big weight. You want to signal strength without taking on unnecessary risk. In this guide, you will learn what earnest money is, how much buyers in Bellevue typically offer, how contingencies protect you, and exactly how to handle the deposit from offer to closing. Let’s dive in.
Earnest money basics
Earnest money is a good‑faith deposit you deliver after your offer is accepted. It shows you are serious and committed to closing. At settlement, your deposit is applied to your cash to close, which includes your down payment and closing costs.
In Bellevue, most purchase agreements use standard NWMLS forms that spell out the amount, due date, contingencies, and dispute procedures. The deposit is held in trust until closing or release based on the contract. It does not replace your mortgage approval or other closing funds.
How much to offer in Bellevue
There is no single rule, but many buyers offer 1% to 3% of the purchase price. Local prices are higher on the Eastside, so deposits are often larger in dollar terms.
- Typical range: 1% to 3% of your offer price
- Example: On a 1,000,000 dollar home, 10,000 to 30,000 dollars is common
- Competitive scenarios: You may see deposits above 3% or large flat amounts to stand out
- Lower‑priced homes or offers with more contingencies may use smaller deposits
Work with your agent to right‑size your deposit for your specific neighborhood and price band. Bigger is not always better if you can strengthen your offer in other ways.
Contingencies that protect your deposit
Contingencies are conditions in the contract that allow you to cancel and receive your earnest money back if certain events do not go as planned. They only protect you if you follow the contract timelines and notice rules.
Common contingencies in Bellevue and across Washington include:
- Inspection or due‑diligence: Lets you investigate the property and cancel within the inspection period if needed.
- Financing (loan) approval: Protects you if your lender does not issue a commitment within the agreed timeframe.
- Appraisal: Helps if the property appraises below the contract price.
- Title and HOA review: Allows cancellation if unacceptable title or homeowners association issues arise.
- Sale of home: Makes your purchase contingent on selling your current home (less common in tight seller markets).
Tip: Keep essential protections in place until your concerns are resolved. Shortening timeframes can be attractive to a seller, but removing protections increases your risk.
Who holds the deposit and when it’s due
Your earnest money is usually held by the escrow or title company that will close your transaction. Sometimes, the listing brokerage may hold it in a trust account based on the agreement. Either way, it stays in trust until closing or release according to the contract.
Most contracts require delivery shortly after mutual acceptance, often within 24 to 72 hours. Always check your signed offer for the exact deadline and instructions on how to deliver funds.
Be sure to get a written receipt with the amount, date, and the name of the escrow holder. Keep it with your contract documents.
When you get it back vs. when you could lose it
Your earnest money is typically refunded to you if:
- You cancel within a valid contingency period per the contract
- The seller cannot meet a material contract requirement, such as delivering marketable title
- Both parties sign a mutual release returning your funds
Your deposit can be at risk if:
- You default after contingencies expire or you cancel without a contractual right
- You fail to deliver the deposit on time and the contract treats late delivery as a breach
- You waive protections and then try to cancel for a reason not allowed by the contract
If there is a dispute, escrow will hold the funds until both sides sign a release or until the matter is resolved through the purchase agreement’s dispute process, court order, or escrow’s interpleader action. Many standard forms allow the seller to keep the earnest money as liquidated damages if the buyer defaults, but remedies depend on the exact language in your agreement.
Strategy: using earnest money to strengthen your offer
A thoughtful earnest‑money plan can help you compete in Bellevue without overexposing yourself.
- Pair your deposit with a strong pre‑approval. A lender letter that confirms full underwriting is powerful and may reduce the need to raise your deposit.
- Keep key protections while you investigate. Consider a focused inspection timeline rather than waiving your inspection outright.
- Align size to the price band. Higher‑end homes often warrant larger dollar amounts, but the percentage still tends to fall near 1% to 3%.
- Move quickly on due diligence. Schedule inspection and document reviews immediately so you can either proceed with confidence or exit within deadlines.
- Confirm logistics in writing. Know exactly where to send funds, the due date, and how to document delivery.
Step‑by‑step: delivering and tracking your deposit
Use this simple checklist to keep your deposit safe and on track:
- Confirm the amount in your signed offer and note the delivery deadline.
- Verify the escrow or title company that will hold the funds and get wiring or delivery instructions directly from them by phone.
- Deliver the deposit before the deadline (wire, cashier’s check, or as specified in the contract).
- Save your receipt and notify your agent that funds are delivered.
- Track contingency dates on your calendar. Submit any notices in writing and on time.
- Before the final walkthrough, confirm that your earnest money will be applied to cash to close at settlement.
Bellevue examples to make it real
Every situation is different, but these scenarios show how the rules work in practice:
- Multiple offers, inspections allowed: You offer 2% earnest money with a 7‑day inspection and a strong pre‑approval. You discover a roof issue and negotiate a credit within the inspection period. You proceed to closing and your deposit applies to your cash to close.
- Appraisal shortfall: You include an appraisal contingency. The appraisal comes in low and the seller will not reduce price. You cancel within the contingency window and receive your earnest money back.
- Waived protections: You waive inspection and financing, then later decide not to close. You may forfeit your earnest money if the contract treats it as liquidated damages for buyer default.
The bottom line for Bellevue buyers
Your earnest money is a small portion of your budget that tells a seller you are serious. Size it to local norms, keep essential protections until your questions are answered, and follow deadlines exactly. With a clear plan, you can submit a confident offer and protect your deposit at the same time.
If you want a calm, step‑by‑step path through Bellevue’s market, reach out to Carrie Haymond for a personalized strategy.
FAQs
What is earnest money in a Bellevue home purchase?
- It is a good‑faith deposit you pay after your offer is accepted, held in trust and applied to your cash to close at settlement under the terms of your contract.
How much earnest money do Bellevue buyers typically put down?
- Many buyers offer 1% to 3% of the purchase price, with higher dollar amounts common at Eastside price points and larger deposits used in bidding competitions.
Who holds my earnest money and how fast must I deposit it?
- The escrow or title company usually holds it, and most contracts require delivery within 24 to 72 hours after mutual acceptance (check your signed agreement).
What contingencies help me keep my deposit safe?
- Inspection, financing, appraisal, and title or HOA review contingencies allow you to cancel within set deadlines and typically receive a refund of your earnest money.
When could I lose my earnest money in Bellevue?
- You risk forfeiture if you default after contingencies expire, cancel without a contractual right, or fail to deliver the deposit on time as required by your agreement.
