Writing an offer in Kirkland, Bellevue, or Redmond and wondering how much earnest money you should put down and when you can get it back? You are not alone. On the Eastside, strong demand and quick timelines can make this part of the process feel high stakes. In this guide, you will learn exactly how earnest money works in Washington, how Eastside norms shape your strategy, and how contingencies protect your deposit. Let’s dive in.
Earnest money basics in Washington
Earnest money is a good-faith deposit that shows a seller you are serious. It is paid after your offer is accepted and is typically applied to your down payment or closing costs when you close.
Your purchase and sale agreement controls the details. It sets the amount, due date, who holds the funds, when the deposit is refundable, and what happens if either party defaults. If you remove or miss contingency deadlines and then fail to close, the seller may be entitled to keep your deposit under the contract’s remedies section.
Who holds the funds and how it is handled
In Washington, earnest money is usually held in an escrow or trust account. That can be a title or escrow company, the escrow agent named in the contract, or a brokerage trust account. Funds must be handled with fiduciary care.
Always confirm in writing who will hold the deposit and the delivery method. Once you transfer the money, request and save a receipt.
How much to put down on the Eastside
There is no single right number, but there are clear patterns. Many buyers use a fixed dollar amount or a percentage of the purchase price. A common range is about 1 to 3 percent of the price. In highly competitive situations on the Eastside, buyers sometimes offer more to stand out.
Here is a simple way to decide:
- Conservative approach: a smaller, refundable deposit, such as 1 percent or a modest fixed amount, paired with strong contingencies.
- Competitive signal: a larger deposit, often 2 to 5 percent, especially in multiple-offer situations. This is often paired with shorter timelines or waived contingencies.
- Cash or very strong financing: deposit size is flexible. Cash buyers sometimes use larger deposits for impact, but they can also rely on the certainty of close.
Local practice shifts with the market cycle. In hotter Eastside markets, expect larger deposits and quicker decisions. In balanced periods, sellers may accept smaller deposits with more protections.
Contingencies that protect your deposit
Contingencies are your safety valves. While they are active, your earnest money is typically refundable if you cancel for a covered reason within the agreed period.
The most common contingencies are:
- Inspection contingency. Lets you inspect and cancel or negotiate within a set window.
- Financing contingency. Protects you if your lender cannot approve the loan in time.
- Appraisal contingency. Lets you cancel or renegotiate if the appraisal comes in low.
- Title review. Protects against unacceptable title issues.
Once a contingency expires or you waive it, your ability to get the deposit back for that reason usually ends. If the seller defaults or cannot deliver clear title as required, your deposit is typically refundable.
Typical Eastside timelines
Timelines are negotiable, but local patterns are helpful when you plan:
- Earnest money delivery. Often due within a short period after mutual acceptance, commonly within a few business days, as stated in the contract.
- Inspection period. Often 7 to 10 days. In very competitive offers, buyers sometimes use 5 days.
- Financing contingency. Often 21 to 30 days, depending on lender speed and your pre-approval.
- Appraisal and underwriting. Typically track the lender’s process and any deadlines written into your contract.
Know your exact dates. Acceptance time stamps start the clock, so keep everything in writing.
Eastside offer scenarios you might see
Use these real-world patterns to calibrate your strategy.
Scenario A: Multiple offers, highly competitive
- Offer structure: about 3 percent earnest money, very short or waived inspection, shortened financing timeline, possibly an escalation clause.
- Risk: High. If you waive inspection and later find defects, you usually cannot recover the deposit. If financing falls through after a waiver, the deposit may be at risk.
- Why it works: Larger deposits and fewer contingencies reduce uncertainty for the seller.
Scenario B: Balanced offer with protections
- Offer structure: around 1 percent or a fixed amount such as 3,000 to 10,000 dollars, standard inspection at 10 days, financing at 21 to 30 days, appraisal contingency included.
- Risk: Moderate to low. If you cancel within the contingency periods for covered reasons, the deposit is typically returned.
- Why it works: You show seriousness while preserving key protections.
Scenario C: Cash or very strong financing
- Offer structure: deposit varies. Some cash buyers go larger for impact, others keep it modest and lean on certainty of close. Often keep inspection, sometimes waive financing.
- Risk: Depends on which contingencies you keep or waive. Cash does not eliminate inspection risk unless you waive inspection.
Step-by-step checklist for protected, competitive offers
Do these before you write:
- Secure a strong written pre-approval so you can support shorter financing timelines.
- Decide your deposit size in advance based on price point and competitiveness.
- Select your escrow or title company and confirm how you will deliver funds. Plan for a receipt.
- Review seller disclosures and any property-specific issues such as shoreline or local code items before shortening contingencies.
Draft your offer with care:
- Keep inspection if possible. If you shorten it, preserve the right to cancel for material health or safety issues.
- Use a financing contingency with clear deadlines and definitions of loan denial.
- If waiving appraisal, plan an appraisal-gap strategy with extra cash or a structured addendum.
- Specify who holds the deposit and the delivery timeline. Ask for immediate written confirmation of receipt.
- Clarify dispute resolution steps in escrow instructions where appropriate.
Manage communication and documentation:
- Track acceptance time and every deadline in writing.
- Confirm any changes to timelines with signed addenda.
- Save emails, wire confirmations, and receipts.
If problems arise:
- Notify your agent and escrow holder right away.
- If you believe a contingency allows you to cancel, follow the contract steps in writing and request deposit release instructions.
- Use the dispute resolution process stated in your contract if you cannot agree on release of funds.
Common mistakes to avoid
- Sending the deposit late or to the wrong place. Confirm holder, method, and deadline, then get a receipt.
- Waiving key contingencies without a plan. Shorten timelines rather than fully waiving when you can.
- Ignoring lender pacing. Your financing timeline should match your lender’s reality.
- Assuming “typical” terms apply to every listing. Each seller and property is different, and the market shifts. Calibrate for each offer.
The bottom line for Eastside buyers
Earnest money is refundable while your contingencies are active and becomes exposure once you waive them or let them expire. On the Eastside, stronger offers often pair larger deposits with faster decisions. Protected offers lean on clear inspection and financing contingencies with reasonable deadlines. Align deposit size and timing with your risk tolerance and the competitiveness of the listing.
When you want a clear, data-informed plan for your next Eastside offer, connect with a team that balances negotiation discipline with concierge service. Reach out to The Schuler Team LLC to craft a deposit and contingency strategy that fits your goals.
FAQs
What is earnest money in Washington real estate?
- It is a good-faith deposit paid after mutual acceptance that shows seriousness, is held in escrow or a trust account, and is applied to closing if you complete the purchase.
How much earnest money do Eastside buyers usually offer?
- Many buyers use about 1 to 3 percent of the price, with higher amounts in multiple-offer situations and smaller, refundable deposits when protection is the priority.
Is earnest money refundable if an inspection finds issues?
- Usually yes if you cancel within the inspection period following the contract terms; once the inspection contingency expires or is waived, refund rights are limited.
What happens to my deposit if the appraisal comes in low?
- If you have an appraisal contingency, you can usually renegotiate or cancel within the deadline; if you waive it, you need an appraisal-gap plan or extra cash to proceed.
How quickly do I need to deliver earnest money in King County?
- Delivery is defined in your purchase agreement, but a short window after mutual acceptance is common, so confirm the exact due date and obtain a receipt.
Who holds the earnest money and how do I confirm it?
- A title or escrow company or a brokerage trust account typically holds the funds; verify the holder in your contract, follow the delivery instructions, and keep the receipt.
