Earnest money is a good-faith deposit a buyer puts down when making an offer on a home — typically 1–3% of the purchase price in Nevada — held by a neutral third party (usually the title or escrow company) until closing. It signals the buyer is serious, and it gives the seller some protection if the buyer backs out without a valid contractual reason.
How the Deposit Is Held
Earnest money doesn't go to the seller directly, and it isn't held by either party's agent. It's deposited into an escrow account with the title or escrow company handling the transaction, where it stays until closing — at which point it's applied toward the buyer's down payment and closing costs — or until the deal falls through, at which point the contract terms determine who receives it.
Held by: title or escrow company, not the seller or either agent
Applied at closing: credited toward the buyer's down payment and closing costs
Deposited: usually within 1–3 business days of an accepted offer
When the Buyer Gets It Back
Nevada purchase agreements typically include a due diligence period during which the buyer can back out for reasons specified in the contract — commonly a failed inspection, financing falling through, or an unsatisfactory appraisal — and still receive a full refund of earnest money. This period is negotiated as part of the offer and is one of the terms sellers should evaluate when comparing multiple offers, not just price.
When the Seller Can Keep It
If a buyer backs out for a reason not covered by the contract's contingencies — simply changing their mind after the due diligence period has closed, for example — the seller may be entitled to keep the earnest money as compensation for the time the home was off the market. This isn't automatic; it depends on the specific contract terms and, in a dispute, may require negotiation or mediation between the parties.
Why This Matters When Evaluating Offers
A larger earnest money deposit is one signal of a serious, well-qualified buyer — though it's not the only one. When comparing multiple offers, the earnest money amount, the length of the due diligence period, and the buyer's financing strength all matter together, not just the headline purchase price. A listing agent's job includes helping you weigh these terms as a full package, not just the top-line number.
OPL Realty walks every seller through offer terms — including earnest money and contingencies — as part of full-service representation at a 1.5% listing commission, for sellers throughout Mira Loma, Old Southwest, and the greater Reno-Tahoe area.