Earnest Money In Westside Offers Explained

Ever wonder how much earnest money you should offer on a Mar Vista home, and what happens to that deposit if plans change? You are not alone. Understanding how deposits work on the Westside helps you write a competitive offer without taking on unnecessary risk. In this guide, you will learn typical deposit ranges, what protects your money, and smart strategies for Mar Vista and nearby Westside neighborhoods. Let’s dive in.

What earnest money means

Earnest money is a good-faith deposit you provide after your offer is accepted. Escrow holds it in a trust account and later applies it to your down payment or closing costs at closing. If you cancel under valid contract contingencies within the allowed time, the deposit is typically returned. The amount and protections are negotiated in your purchase agreement.

Typical Westside deposit ranges

On the Westside, deposit expectations often run higher because of price points and competition. A conservative baseline is about 1 percent of the purchase price in a balanced market. In competitive situations, 2 to 3 percent is common, and 3 to 5 percent can be used for very strong offers.

Here are simple examples to show scale:

• For an $800,000 home: 1 percent is $8,000; 3 percent is $24,000.
• For a $1,500,000 home: 1 percent is $15,000; 3 percent is $45,000.

These figures are illustrative. Your strategy should reflect the property, competition, and your comfort level.

How the escrow process works

After the seller accepts your offer, escrow opens and you deliver the deposit by the deadline in the contract, often within 24 to 72 hours. Escrow or title holds funds in a trust account, separate from agent accounts. You can use a cashier’s check, a cleared personal check, or a wire to verified instructions.

Escrow issues a receipt and tracks your deposit. At closing, the deposit becomes a credit toward your funds to close, which you will see on your final closing statement.

Contingencies that protect your deposit

Your deposit is refundable if you cancel according to contract contingencies and within the agreed timelines. Common protections include:

• Inspection contingency: You can cancel within the inspection period if findings are unacceptable. Once you remove this contingency in writing, your deposit is more exposed.
• Loan contingency: If your lender cannot approve your loan per the contract terms and you cancel within the loan contingency period, your deposit is typically refundable.
• Appraisal contingency: If the appraisal comes in low, you can renegotiate, cover the difference, or cancel within the terms and recover your deposit.
• Title, HOA, and disclosure review: If documents reveal issues you cannot accept, you can cancel within the review period.

Important: Contingency periods are negotiated. When you remove a contingency in writing, you usually give up the right to use that contingency later.

When deposits become nonrefundable

Your deposit can be at risk if you remove contingencies and then cannot close, or if you breach the contract after contingency periods expire. Sellers may seek to keep the deposit as liquidated damages depending on the contract. If a dispute arises, escrow will hold the funds until both parties sign a release or a final order is issued under the dispute resolution terms in the contract.

What happens at closing or cancellation

If the sale closes normally, your deposit is applied to your down payment or closing costs. If the parties cancel by mutual agreement, escrow returns funds based on signed instructions. If there is a dispute, escrow holds the funds until there is a written agreement from both parties or a court or arbitrator order. Escrow does not decide who is right; it follows the instructions or legal outcome.

Strategy tips for Mar Vista buyers

• Plan your deposit: Budget 1 to 3 percent of your target price, and be ready to go higher when competition is intense.
• Keep funds liquid: Have your deposit accessible and verifiable so you can deliver it quickly once your offer is accepted.
• Balance risk and strength: A bigger deposit signals seriousness but ties up more cash. Shorter contingency periods, a stronger price, or an escalation clause can also help you compete without giving up important protections.
• Know when to hold firm: Only waive or shorten contingencies if you fully understand the risk and your lender confirms you can close on time.

Safe payment and wire tips

Wire fraud attempts are real. Before you send any funds, call your escrow officer using a known, independently verified phone number to confirm instructions. Do not rely on email alone for wiring details. If anything looks off, pause and verify again.

Mar Vista and nearby Westside context

Mar Vista, Venice, Santa Monica, and West LA often see multiple-offer situations, which can push deposits higher. In calmer pockets or at longer days on market, 1 percent can still work. Ask your agent to share recent winning offer examples in your price range so you can calibrate deposit size, contingency timing, and price for the specific home you want.

Working with your lender and agent

Talk with your lender early so you understand what documentation is needed to remove your loan and appraisal contingencies with confidence. A local Westside agent can help you match deposit size and timelines to the property, seller expectations, and recent comp activity. That guidance is especially valuable if you are relocating or buying your first home in this area.

The bottom line

Your earnest money is a tool. Used well, it shows the seller you are serious while keeping your risk in check. In Mar Vista and across the Westside, most buyers succeed by planning 1 to 3 percent for their deposit, verifying funds, and tailoring contingencies to the home and competition. If you want help crafting a confident offer strategy, reach out to Scott Price for local guidance.

FAQs

How does earnest money work for Westside buyers?

• It is a good-faith deposit held by escrow after acceptance. It is applied to your closing costs or down payment, or returned if you cancel under valid contingencies within the allowed time.

What is a typical earnest money amount in Mar Vista?

• About 1 percent is a baseline in balanced conditions, 2 to 3 percent is common in competition, and 3 to 5 percent can be used for very strong offers.

When do I have to deliver my deposit?

• Your purchase agreement sets the deadline, often within 24 to 72 hours after acceptance. Follow your agent and escrow instructions closely.

Are inspection, loan, and appraisal contingencies refundable?

• Yes if you cancel within each contingency period according to the contract terms. After you remove a contingency in writing, your deposit becomes more at risk.

What happens to my deposit at closing?

• It appears as a credit on your closing statement and reduces the funds you need to bring in at closing.

Can the seller keep my deposit if my loan is denied?

• If you have an active loan contingency and cancel within its timeline, the deposit is typically refundable. If you removed that contingency, the seller may claim a breach.

Is wiring my deposit safe?

• Yes if you verify instructions by phone with your escrow officer at a known number. Never rely on email alone for wire details.