Thinking about making an offer on a home in Post Falls and wondering how much earnest money you should put down? You’re not alone. This is one of the most common questions buyers ask, and getting it right can help you win the house while still protecting your money. In this guide, you’ll learn what earnest money is, how it works in Kootenai County, when it’s due, and the steps you can take to keep your deposit safe. Let’s dive in.
What earnest money means
Earnest money is a good‑faith deposit you submit after your offer is accepted. It shows the seller you’re serious and committed to closing. The deposit is held in an escrow or trust account until closing.
In most transactions, your earnest money is credited to your cash to close at settlement. The details are controlled by the purchase agreement, including deadlines, contingencies, and what happens if either side defaults. If a dispute arises, the escrow holder will keep the funds in the account until both parties agree in writing or a court or arbitrator orders a release.
Typical amounts in Post Falls
There is no single “right” number. In Kootenai County, common practice looks like this:
- Entry‑level homes: often a flat amount around 1,000 to 3,000 dollars.
- Mid‑priced homes: roughly 1 percent of the purchase price is a common rule of thumb.
- Higher‑price or very competitive listings: 2 percent or more, or a larger flat amount.
Your strategy should reflect the property, your financing, and current competition. A larger deposit can make your offer stronger, but it also increases your risk if you miss deadlines or default. A smaller deposit reduces your exposure but may be less attractive in multiple‑offer situations. Work with your agent to match the amount to the market and your comfort level.
When your deposit is due and where it goes
The purchase contract sets the deadline for delivering earnest money. In practice, many offers require delivery within 24 to 72 hours after mutual acceptance. Some listing agents ask for immediate delivery. The written contract controls, so always follow those dates exactly.
Funds are typically delivered to a title or escrow company named in the agreement. In some cases, the listing brokerage may hold deposits in a trust account. You will receive a receipt that shows the amount, the date received, and who is holding the funds.
Common delivery methods include a cashier’s or certified check, a wire transfer to the escrow company, or an approved electronic payment system. Your lender may ask for proof of the deposit and documentation that shows where the funds came from. Coordinate with your loan officer before you transfer large sums so you have everything underwriting will need.
Wire safely and avoid fraud
Wire fraud is an ongoing risk in real estate. Take a few simple steps to safeguard your deposit:
- Verify wiring instructions directly with the escrow or title company by calling a phone number you look up independently.
- Never rely on wiring instructions that arrive by email without verification.
- Never wire to an individual’s personal account.
- Keep copies of wire confirmations, receipts, and any emails or letters you receive.
How contingencies protect your money
Contingencies are your contract protections. If you use them correctly and on time, they typically allow you to cancel and receive a refund of your earnest money. Common buyer contingencies include:
- Inspection contingency. If an inspection reveals major issues and you give proper notice within the inspection period, you may cancel and recover your deposit.
- Financing contingency. If you cannot obtain loan approval despite good‑faith efforts and you provide timely notice, your deposit is usually refundable.
- Appraisal contingency. If the appraisal comes in below the purchase price and you cannot bridge the gap, you can often cancel within the deadline and recover your funds.
- Title contingency. If a title defect cannot be resolved by the deadline, you may have the right to terminate and receive your deposit back.
- Home sale contingency. If your purchase depends on selling your current home and that sale does not occur on time, the contract may allow you to cancel and keep your deposit.
- Casualty loss. If the property is substantially damaged before closing, standardized clauses often let you walk away with a refund of your deposit.
Every contingency has exact timelines and notice requirements. Put deadlines on your calendar, and use written communications to exercise your rights.
When your deposit is at risk
Your earnest money can be at risk if you miss deadlines or do not follow the contract. Situations that commonly lead to forfeiture include:
- You miss a contingency deadline or attempt to cancel after waiving a protection.
- You fail to secure financing because you did not act in good faith or misrepresented your finances.
- You default without a contractually allowed reason, and the agreement permits the seller to keep the deposit as liquidated damages.
If a dispute arises, escrow holders generally do not release funds without written authorization from both parties or a court or arbitrator. Most contracts include instructions for mediation or arbitration. Keep your agent involved, follow the contract, and consider legal counsel if needed.
Practical steps to protect your deposit
Before you write an offer:
- Get a full pre‑approval, not just a pre‑qualification.
- Discuss an earnest money strategy with your agent that fits the property, price point, and competition.
- Confirm with your lender how you will document the source of funds, including any gifts.
When you make the offer:
- Include protective contingencies for inspection, financing, appraisal, and title.
- Set realistic deadlines and clearly state how and where to deliver your deposit.
- Name the escrow or title company that will hold the funds.
Right after acceptance:
- Deliver your deposit on time and get a written receipt.
- Send proof of deposit to your lender and provide any bank statements or gift letters they require.
- Order inspections immediately and track all contingency timelines in a shared schedule with your agent.
If issues arise:
- Use the contract’s written notice procedures to request repairs, extend deadlines, or cancel. Do not rely on verbal conversations alone.
- Keep copies of every email, signed addendum, and escrow receipt.
- If the seller claims your deposit, review the contract with your agent and consider mediation, arbitration, or legal advice per the agreement.
What happens at closing or if the deal ends
If you close, earnest money is usually credited to your cash to close. This reduces the amount you need to bring to settlement. Whether the escrow account pays interest, and who receives it, depends on the account type and the contract, but in most cases buyers do not receive interest on their deposit.
If the deal does not close, the release of funds follows the contract. Escrow typically needs written instructions signed by both parties or a court or arbitrator’s order. Build realistic timelines into your offer so you have room to complete inspections, secure financing, and exercise any rights within the deadlines.
Quick buyer checklist
- Choose a smart deposit amount for the property and market.
- Put earnest money delivery details and all contingency deadlines in the contract.
- Deliver funds on time to the named escrow holder and get a receipt.
- Verify any wiring instructions by phone using a verified number.
- Coordinate with your lender on documentation and seasoning of funds.
- Track timelines closely and give all notices in writing.
- Keep organized records of checks, wires, and all contract communications.
Ready to talk through your specific situation and craft a strategy that fits the current Post Falls market? Reach out to Kevin Pickford & Kyra Beamis for local guidance, a clear plan, and a smooth path to closing.
FAQs
What is earnest money in an Idaho home purchase?
- It is a good‑faith deposit you submit after your offer is accepted. The funds are held in escrow and typically credited to your cash to close unless the contract says otherwise.
How much earnest money should I offer in Post Falls?
- Many buyers offer 1,000 to 3,000 dollars for entry‑level homes, about 1 percent for mid‑priced homes, and 2 percent or more for highly competitive or higher‑price listings. The right amount depends on the property and market.
When is earnest money due after my offer is accepted?
- Your contract sets the deadline. In local practice it is often due within 24 to 72 hours after mutual acceptance, but always follow the written date in your agreement.
Can I get my earnest money back if my financing falls through?
- Usually yes if your contract includes a financing contingency and you give timely written notice after making good‑faith efforts to obtain the loan.
Who holds earnest money in Kootenai County transactions?
- The deposit is typically held by a title or escrow company named in the contract. In some cases, the listing brokerage may hold funds in a trust account.
How do I avoid wire fraud when sending my deposit?
- Call the escrow or title company using a verified number to confirm wiring instructions, never wire to a personal account, and keep copies of all confirmations and receipts.
