Earnest Money Deposit

Definition

  • Like a deposit, the buyer gives the seller money when making a formal offer to show he or she is serious about the transaction.

Notes
A down payment.

Synonyms
backing, good faith gesture, earnest payment, cash deposit

Acronyms
EMD

Alternate Spellings
Good faith deposit, Goodfaith deposit, Earnest Payment, Good-faith deposit

Related Terms and Acronyms

  • Deposit Definition,
    • A sum of money put towards a given transaction. In a property purchase, a deposit signifies the intent to buy, which is paid to the vendor and applied to the principal cost.
    • An act of putting a sum of money in to a bank account.
  • Low Ball Offer Definition,
    • A way-below-market bid a buyer makes on a property or item.
  • Trust Account Definition,
    • An account used by a law firm or real estate agent to handle earnest money, funds set aside for repairs and other money that the buyer and seller put up before closing.
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