When you are ready to make an offer on a particular house and maybe want to show the seller that you are serious about the purchase, there is a way you can use to prove your seriousness. And this is where earnest money comes in in the home buying process.
Earnest money, in most cases, acts as a deposit in the dream home you want to buy. The buyer delivers the money when signing the purchase or sales contract. Moreover, this good faith deposit can as well be part of the hospice buying offer. Before closing the deal, the buyer and the seller sign an agreement that defines the terms and conditions of refunding the earnest funds.