How much should you put down as earnest money in Sandy Springs, and what happens to it if your plans change? These are smart questions to ask before you write an offer. When you understand how earnest money works, you can strengthen your offer while keeping your deposit protected.
In this guide, you’ll learn what earnest money is, typical deposit ranges in Sandy Springs, the timelines and contingencies that protect you, and what to expect if a deal hits a snag. Let’s dive in.
Earnest money basics in Sandy Springs
Earnest money is your good-faith deposit that accompanies a purchase contract. It shows the seller you are serious, it is credited to your purchase at closing, and it sits in escrow while contingencies are worked through. It is not a fee and becomes part of your down payment or closing funds if the sale closes.
In Georgia, the deposit is commonly held by the title company or closing agent named in the contract. In some cases, it can be held in a brokerage trust account if permitted. In the Atlanta metro area, it is typical for a title or settlement company to hold the funds.
A larger or faster earnest money deposit can make your offer more attractive to a seller. Many contracts allow a seller to keep the deposit if a buyer defaults, so the size and timing of your deposit are part of your negotiation strategy.
How much is typical
There is no single required amount, but common patterns have emerged in North Fulton and Perimeter submarkets:
- Lower-priced homes or slower segments: flat deposits around 1,000 to 5,000 dollars are common.
- Mid-priced homes: many buyers use about 1 percent of the purchase price as a reference point.
- Higher-priced or very competitive situations: 1 to 3 percent, or a larger flat amount, can help an offer stand out.
Local conditions drive the range. Price point, inventory, days on market, and the number of competing offers all influence what sellers expect. Lenders do not require a specific deposit, but they do review your overall funds and the contract’s terms.
When you pay and key deadlines
Your contract sets the earnest money due date. In this area, buyers commonly deliver the deposit within 48 to 72 hours after both parties sign the contract. Timing matters for your protections.
Typical timeline ranges you may see in regional practice include:
- Earnest money due: within 2 to 3 days after contract acceptance.
- Inspection or due diligence: about 7 to 14 days from acceptance.
- Appraisal ordered and received: often within 10 to 21 days, coordinated with your lender.
- Loan approval or commitment: often 21 to 30 days.
- Closing: commonly 30 to 60 days from acceptance.
These are common ranges, not rules. Your signed contract controls the exact dates.
Contingencies that protect your deposit
Contingencies give you the right to cancel with a refund of your earnest money if you act within the agreed timelines and follow notice rules in the contract. The most common are:
- Inspection or due diligence: Inspect the home, request repairs, or cancel within the period.
- Financing: Cancel if you cannot obtain your loan by the deadline, with proper notice and required documentation.
- Appraisal: If the appraisal is below the price, you can renegotiate or cancel within the appraisal window.
- Title and HOA review: Review title or HOA documents and cancel if unacceptable issues emerge within the review period.
- Sale-of-home: Make your purchase contingent on selling your current home. This is less common in competitive situations.
Refunds, forfeitures, and deadlines
If you terminate within a contingency window and provide timely written notice, your earnest money is generally refundable. Your contract may require you to deliver certain documents, such as an inspection report or a lender’s denial letter, to qualify for a refund.
If you miss a deadline and later try to cancel, you risk forfeiting your deposit if the seller claims a breach. Many Georgia contracts include language that lets the seller keep the deposit as liquidated damages if a buyer defaults. The exact wording of your contract controls the outcome.
If things go wrong: defaults and disputes
If a buyer defaults, a seller may keep the earnest money if the contract allows and the seller elects that remedy. A seller can also pursue other remedies depending on the contract.
If a seller defaults, you may be entitled to the return of your deposit and may have additional remedies. Disputes over earnest money are typically held by the escrow holder until both sides agree or a final resolution is reached. Many contracts call for mediation or arbitration before any court action. If a dispute arises, speak with your closing attorney about next steps.
How to craft a strong and safe offer
You can present a competitive offer while keeping sensible protections in place. Consider these strategies:
- Use a meaningful deposit and fast delivery, balanced with realistic contingency timelines.
- Keep inspection, appraisal, and financing protections if you need them, and shorten the windows only if you can meet them.
- Pair your deposit with a strong pre-approval and clear proof of funds for any cash portion.
This approach signals commitment without taking on avoidable risk.
What to spell out in your offer
Make sure your contract clearly addresses the following:
- Exact earnest money amount, stated as a dollar figure or percentage.
- Due date for the deposit, for example, within a set number of days after acceptance.
- Who will hold the funds, such as a specific title company or brokerage trust account.
- Due diligence or inspection period, including deadlines and how to deliver notices.
- Financing contingency terms, loan approval deadline, and required documentation if denied.
- Appraisal contingency language and what happens if the appraisal is below price.
- Title and HOA review periods, if applicable.
- The dispute resolution process for earnest money disagreements.
- Whether the seller accepts earnest money as liquidated damages if the buyer defaults.
Local pointers for Sandy Springs buyers
Sandy Springs and nearby Perimeter neighborhoods cover a wide range of price points, from townhomes to higher-end single-family homes. Earnest money norms vary by submarket and listing profile. Inventory and days on market are the biggest drivers of how strong your deposit should be, especially when multiple offers are common.
If you want a deposit strategy and contingency plan tailored to your price point and the specific home, let’s talk. For a discreet, negotiation-forward approach, connect with Brandon Patterson to align your earnest money with a winning offer.
FAQs
How much earnest money should I offer in Sandy Springs?
- A common starting point is about 1 percent for mid-priced homes, with 1,000 to 5,000 dollars for lower-priced and 1 to 3 percent for higher-priced or highly competitive situations.
Is earnest money refundable if I cancel the contract?
- It is generally refundable if you cancel within a valid contingency window and deliver required written notice and documents by the deadlines stated in your contract.
Who holds the earnest money in Georgia transactions?
- The deposit is typically held by the title company or closing agent named in the contract, or by a brokerage trust account if permitted.
What happens if I miss the inspection or financing deadline?
- Missing a deadline can put your deposit at risk of forfeiture if you later try to cancel, so act promptly and follow your contract’s notice rules.
Can a seller keep my earnest money if they accept another offer?
- If a seller defaults, you may be entitled to the return of your deposit and other remedies, subject to the contract and Georgia law.
When is my earnest money applied at closing?
- At closing, your earnest money is credited toward your down payment or closing costs as part of your total funds to close.
