Earnest Money definition: Copy, customize, and use instantly
Introduction
The term "Earnest Money" refers to a deposit made by a buyer to demonstrate their commitment to a transaction, often in real estate or business agreements. It serves as a good-faith gesture, ensuring that both parties are serious about completing the deal. This deposit is typically applied toward the purchase price or refunded depending on the fulfillment of contractual obligations.
Below are various examples of how "Earnest Money" can be defined in different contexts. Copy the one that fits your needs, customize it, and use it in your contract.
Definition of "Earnest Money" as a deposit
This definition ties "Earnest Money" to its role as a financial deposit to secure a contract.
"Earnest Money" refers to a deposit made by the buyer to show their commitment to entering into a contract, typically applied toward the purchase price or refunded according to the terms of the agreement.
Definition of "Earnest Money" as a good-faith deposit
This definition connects "Earnest Money" to its function as a sign of good faith in transactions.
"Earnest Money" means a sum of money given by a buyer as a demonstration of serious intent to proceed with the transaction, which may be forfeited if the buyer fails to fulfill the contractual obligations.
Definition of "Earnest Money" as part of purchase price
This definition links "Earnest Money" to its application toward the purchase price of the transaction.
"Earnest Money" refers to the amount of money paid by the buyer at the time of agreement, which will be credited toward the purchase price at closing or refunded in case of contract termination under specific conditions.
Definition of "Earnest Money" in real estate agreements
This definition applies "Earnest Money" specifically to real estate transactions.
"Earnest Money" means a sum of money deposited by the buyer to secure a real estate contract, which will be applied to the down payment or refunded based on the terms outlined in the purchase agreement.
Definition of "Earnest Money" as a contract security
This definition ties "Earnest Money" to its purpose as a security for both parties.
"Earnest Money" refers to money paid by the buyer as a guarantee of the buyer’s intent to proceed with the transaction, which can be forfeited if the buyer defaults.
Definition of "Earnest Money" as a refundable deposit
This definition connects "Earnest Money" to its potential for refundability.
"Earnest Money" means a deposit made to show good faith, which is refundable to the buyer if the transaction is not completed due to specific conditions or contingencies outlined in the contract.
Definition of "Earnest Money" in business transactions
This definition applies "Earnest Money" to business transaction scenarios beyond real estate.
"Earnest Money" refers to an initial payment made by the buyer to demonstrate serious intent in entering a business agreement, which may be refunded or applied toward the final purchase price depending on the contract terms.
Definition of "Earnest Money" as a penalty for breach
This definition ties "Earnest Money" to its role as a penalty in case of buyer’s breach of contract.
"Earnest Money" means a deposit given by the buyer as an assurance of performance, which may be forfeited as a penalty if the buyer defaults on the contract without legal cause.
Definition of "Earnest Money" in escrow
This definition links "Earnest Money" to an escrow arrangement.
"Earnest Money" refers to funds held in escrow by a third party until the terms of a contract are satisfied, ensuring both parties fulfill their obligations before the transaction is finalized.
Definition of "Earnest Money" as a contractual requirement
This definition connects "Earnest Money" to its role as a required element of a contract.
"Earnest Money" means the amount of money paid by the buyer as part of the agreement to enter into a contract, with the amount and conditions for its return or forfeiture clearly outlined in the agreement.
Definition of "Earnest Money" as security deposit
This definition ties "Earnest Money" to the concept of a security deposit.
"Earnest Money" refers to the deposit made by the buyer as a sign of good faith in a transaction, held as security against the completion of the contract or for damages in case of breach.
Definition of "Earnest Money" in non-refundable contracts
This definition links "Earnest Money" to its role in non-refundable contracts.
"Earnest Money" means a deposit paid by the buyer that becomes non-refundable if the buyer fails to complete the transaction as stipulated in the contract.
Definition of "Earnest Money" in conditional agreements
This definition applies "Earnest Money" to contracts with specific conditions.
"Earnest Money" refers to a deposit made to show intent to enter into a contract, which may be returned or retained based on the fulfillment of agreed-upon contingencies.
Definition of "Earnest Money" in the context of purchase agreements
This definition ties "Earnest Money" to its use in formal purchase agreements.
"Earnest Money" means the sum paid by the buyer at the time of signing a purchase agreement, credited toward the purchase price if the transaction proceeds or refunded if the agreement is voided under specific conditions.
Definition of "Earnest Money" as a sign of commitment
This definition connects "Earnest Money" to its role in demonstrating commitment to the transaction.
"Earnest Money" refers to an upfront payment made by the buyer to indicate serious intent and commitment to completing the transaction, typically credited to the final purchase amount.
Definition of "Earnest Money" as a binding deposit
This definition links "Earnest Money" to its role in binding a buyer to an agreement.
"Earnest Money" means the deposit made by the buyer, which is binding and shows intent to complete the transaction, with provisions for forfeiture or refund depending on contract terms.
Definition of "Earnest Money" as a protection for the seller
This definition ties "Earnest Money" to its role in protecting the seller in case of buyer default.
"Earnest Money" refers to a payment made by the buyer as security for the seller, protecting them from potential loss if the buyer fails to perform under the contract.
Definition of "Earnest Money" as a down payment
This definition links "Earnest Money" to its use as part of the down payment for the transaction.
"Earnest Money" means a portion of the purchase price paid by the buyer at the time of the agreement, often applied as a down payment on the final purchase amount.
Definition of "Earnest Money" as a show of trust
This definition ties "Earnest Money" to its role as a symbol of trust between buyer and seller.
"Earnest Money" means a sum paid by the buyer as an indication of trust and intent to complete the transaction, with provisions for its return or forfeiture based on specific conditions.
Definition of "Earnest Money" in commercial leases
This definition connects "Earnest Money" to commercial leasing agreements.
"Earnest Money" refers to a deposit made by a lessee as a commitment to a commercial lease agreement, which may be credited toward the first month’s rent or refunded if the lease is terminated under specific circumstances.
Definition of "Earnest Money" in auction contracts
This definition ties "Earnest Money" to its use in auction-style transactions.
"Earnest Money" refers to the initial payment made by the highest bidder in an auction, ensuring their commitment to purchase the item or property if they win the bid.
Definition of "Earnest Money" in the event of contract termination
This definition connects "Earnest Money" to situations where the contract is terminated.
"Earnest Money" means a deposit made by the buyer that may be refunded or forfeited depending on the terms of contract termination, including whether the seller or buyer is at fault.
Definition of "Earnest Money" in financing agreements
This definition ties "Earnest Money" to its use in financing agreements.
"Earnest Money" refers to a sum paid by the buyer in financing agreements, demonstrating commitment to proceeding with the loan or funding arrangement, which may be applied to the loan amount or refunded if the agreement is not finalized.
Definition of "Earnest Money" as security in lease-option agreements
This definition connects "Earnest Money" to its use in lease-option agreements.
"Earnest Money" refers to a payment made by the tenant in a lease-option agreement, which is held as security for the option to purchase the property at a later date.
Definition of "Earnest Money" as a refundable deposit in retail contracts
This definition links "Earnest Money" to its role in retail contracts.
"Earnest Money" means a refundable deposit made by the buyer in retail contracts, ensuring the buyer's commitment to purchase the product, typically refunded if the sale does not occur.
Definition of "Earnest Money" in property management agreements
This definition ties "Earnest Money" to its use in property management agreements.
"Earnest Money" refers to the amount paid by the prospective tenant or buyer in a property management contract to demonstrate serious interest in leasing or purchasing a property, which may be applied to rent or purchase price or refunded under certain conditions.
Definition of "Earnest Money" as a requirement for contract acceptance
This definition connects "Earnest Money" to its role in contract acceptance.
"Earnest Money" means a deposit required by the seller to accept the buyer's offer, which may be forfeited or credited toward the final transaction depending on the terms of the agreement.
Definition of "Earnest Money" in multi-party transactions
This definition links "Earnest Money" to its role in multi-party transactions.
"Earnest Money" refers to a deposit made by the buyer in transactions involving multiple parties, serving as a guarantee that the buyer intends to complete the deal according to the contract.
Definition of "Earnest Money" as part of a closing cost
This definition ties "Earnest Money" to closing costs.
"Earnest Money" means the deposit made by the buyer, which is often credited toward the closing costs or down payment upon the successful completion of the transaction.
Definition of "Earnest Money" in contingency-based agreements
This definition connects "Earnest Money" to contingency-based contracts.
"Earnest Money" refers to the deposit made by the buyer in contingency-based agreements, which may be refunded or applied depending on the fulfillment of specific conditions or contingencies.
Definition of "Earnest Money" in international transactions
This definition links "Earnest Money" to its use in international transactions.
"Earnest Money" means a deposit paid by the buyer to demonstrate good faith in international transactions, often held in escrow or applied to the purchase price depending on the agreement's terms.
Definition of "Earnest Money" as non-refundable in specific cases
This definition connects "Earnest Money" to its non-refundable nature in some cases.
"Earnest Money" refers to a deposit made by the buyer that becomes non-refundable if certain conditions or deadlines are not met, such as failure to secure financing or complete the necessary inspections.
Definition of "Earnest Money" in joint ventures
This definition ties "Earnest Money" to joint venture agreements.
"Earnest Money" means a deposit made by a party in a joint venture agreement, serving as a commitment to proceed with the partnership and often used to cover initial costs or operational expenses.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.