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What is an Earnest Money Deposit?

Earnest money is one of the most critical real estate terms every home buyer and seller should understand—the earnest money an agent collects can best be described as the glue behind the transaction.

Like it sounds, earnest money proves to a seller that a buyer is “earnest” or serious about buying their home. The amount of earnest money collected can depend on the area of the country in which you are located.

As a general rule, you can expect to pay anywhere from one percent to five percent of the purchase price.

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