what is earnest money 
earnest money is a deposit made to a seller that represents a buyer s good faith to make a purchase such as the acquisition of a new home in many ways earnest money can be considered a deposit on a home an escrow deposit or good faith money investopedia ellen lindnerunderstanding earnest moneyin most cases earnest money is delivered when the sales contract or purchase agreement is signed but it can also be attached to the offer once deposited the funds are typically held in an escrow account until closing at which time the deposit is applied to the buyer s down payment and closing costs the money gives the buyer extra time to get financing and conduct the title search property appraisal and inspections before closing 