Is earnest money confusing you as you plan your offer in Columbus? You are not alone. This small but important deposit can help you win a home and protect your interests if you handle it correctly. In this guide, you will learn what earnest money is, how much buyers in Franklin County typically put down, how refunds work, and practical steps to keep your deposit safe. Let’s dive in.

What earnest money is

Earnest money is a good-faith deposit you submit with your offer or shortly after your contract is accepted. It shows the seller you are serious and gives them confidence to move forward. If you close, the deposit is credited to your purchase price or closing costs. It is not an extra fee, and it is not the same as an option payment unless your contract clearly says so.

If you default outside your contract protections, the seller may claim the deposit as liquidated damages or pursue other remedies, depending on what your purchase agreement allows. Your contract controls what happens, so read it closely.

Typical amounts in Columbus

There is no law that sets an exact amount for earnest money. In the Columbus area, common practice varies by price point and competitiveness:

• Lower-priced entry homes or condos: about $1,000 to $3,000
• Mid-priced single-family homes: about $2,500 to $7,500, roughly 0.5 to 1 percent as a quick guide
• Higher-priced homes or very competitive situations: $5,000 and up, often 1 to 3 percent

These ranges are typical, not required. In multiple-offer scenarios, you may raise the deposit to stand out. In a calmer situation, you may use a smaller amount and rely on strong terms and clean paperwork.

Who holds your deposit in Franklin County

Your purchase contract names the escrow holder. In Columbus, deposits are commonly held by one of these:

• The listing broker’s trust or escrow account
• Your broker’s trust account
• A title or settlement company that will handle your closing

Ohio regulates how licensees and settlement providers handle client funds. Deposits must be placed in proper trust or escrow accounts, with records and disbursements governed by your contract. You should always receive a written receipt and be able to see in your contract where the funds are held and who can release them.

When your earnest money is refundable

The key principle is simple. If you end the contract the right way within an active contingency period and follow all notice rules, your deposit is typically refunded. If you walk away outside those rights, your deposit is at risk.

Common contingencies that protect your refund:

• Inspection contingency: You may inspect the home and cancel or renegotiate within the stated window if you are not satisfied as allowed by the contract.
• Financing contingency: If you cannot obtain financing as specified and you give timely written notice with required documentation, you can cancel and receive a refund.
• Appraisal contingency: If the appraisal comes in below price and remedies in the contract are not met, you can terminate and keep your deposit.
• Title contingency: If title issues cannot be resolved, you may terminate and receive a refund.
• Applicable disclosures and HOA review: If documents reveal issues that allow termination under your contract, your deposit is typically returned.

Timing matters. Most Columbus-area contracts require strict written notice before deadlines expire. Miss a deadline and you may lose your refund rights, even if the issue is valid. Keep records like inspection reports, lender communications, and emails that show you acted in good faith.

Real-world examples

• Example refundable: You find a major foundation issue during inspections and send a written termination within the inspection period. Your earnest money is returned.
• Example at risk: You waived the financing contingency, later your loan is denied, and you cancel. Your deposit is likely at risk.

How and when to deliver earnest money

Your offer or executed contract will set the delivery timeline. In our area, it is often due within 24 to 72 hours after ratification, though your form may be different. Confirm your deadline and the method your escrow holder accepts.

Best practices when you pay:

• Use traceable funds like a bank wire or certified check.
• Confirm wiring instructions directly with the title or escrow company by phone using a known number. Do not rely only on emailed instructions.
• Get a written receipt immediately.
• Save copies of the check, wire confirmation, and receipt in a single folder.

Strategies to strengthen your offer safely

In competitive neighborhoods across Columbus and the northern suburbs, you can improve your offer without taking unnecessary risks. Consider these options:

• Increase your deposit to show commitment while keeping key contingencies in place.
• Shorten inspection, appraisal, or financing timelines if you are well prepared and your professionals can move quickly.
• Tighten documentation delivery promises to the seller, such as preapproval letters and proof of funds.
• Avoid waiving core protections unless you understand the risk and have a strong backup plan.

A larger deposit builds confidence for the seller. Just be sure you can meet all deadlines and are comfortable with the potential exposure if you default.

Step-by-step checklist for buyers

Use this simple checklist to stay on track in Franklin County:

1. Before you offer

• Ask your agent what deposit amount is typical for the property type and neighborhood today.
• Decide how much you can risk without stress if a dispute occurs.
• Line up your lender preapproval and plan inspection scheduling.

2. When your offer is accepted

• Confirm who will hold the escrow and how you will deliver funds.
• Calendar your earnest-money deadline and all contingency dates.
• Send funds with a traceable method and obtain a written receipt.

3. During your contingency windows

• Order inspections immediately and share results with your agent.
• Keep active communication with your lender. Save emails and letters.
• Deliver any required notices in writing before the deadlines.

4. If an issue arises

• Notify your agent and title company in writing.
• Review your contract’s termination and dispute steps.
• Consider consulting a real estate attorney before releasing or forfeiting funds.

Where your money sits before closing

Your deposit is usually held in a non-interest-bearing trust or escrow account, unless your contract specifies otherwise. The escrow holder follows the contract to disburse funds at closing, upon termination, or as directed by both parties if a dispute is resolved. If interest applies, your contract or escrow agreement will say who receives it.

Disputes and how they get resolved

If you and the seller disagree about who should receive the deposit, your contract’s dispute-resolution clause controls the next steps. Many standard forms call for mediation or arbitration. The escrow holder follows the written instructions in your contract or a signed release from both parties. If your contract treats the deposit as liquidated damages, that can cap the seller’s remedy at the deposit amount. Other contracts allow additional claims. Save every document and keep communication in writing to support your position.

Key takeaways for Columbus buyers

• Earnest money shows commitment and is credited to your purchase at closing.
• Typical local deposits range from about $1,000 to $5,000 for many properties, with higher amounts for pricier homes or competitive offers.
• Your contract sets the escrow holder, deadlines, contingencies, and remedies. Follow it closely and keep proof of every step.
• Refunds depend on proper termination within active contingencies and timely written notice.
• Use traceable funds, confirm wiring instructions by phone, and get a receipt.

If you want help tailoring deposit strategy to a specific Columbus neighborhood or price point, reach out. You will get clear guidance on amounts, timelines, and how to compete while protecting your interests. When you are ready to talk next steps, connect with Sarah Berlin Moore for local, buyer-focused advice.

FAQs

What is earnest money in a Columbus home purchase?

• It is a good-faith deposit you submit with your offer or shortly after acceptance, credited to your purchase at closing and governed by your contract.

How much earnest money do Columbus buyers usually put down?

• Many deposits land between $1,000 and $5,000, with higher amounts for pricier homes or competitive offers, often 1 to 3 percent at the high end.

Who holds earnest money in Franklin County, Ohio?

• Your contract names the escrow holder. It is often a title company, the listing broker’s trust account, or your broker’s trust account.

When do I pay earnest money after my offer is accepted?

• Most contracts require delivery within a short window, commonly 24 to 72 hours after ratification. Check your signed contract for the exact deadline.

Can I get my deposit back after inspection in Columbus?

• If you terminate within the inspection contingency period and follow the written notice steps in the contract, your earnest money is typically refunded.

What happens if my financing falls through?

• If you keep an active financing contingency and give required notice on time, you can usually cancel and receive a refund. If you waived financing or miss deadlines, your deposit may be at risk.

How do I avoid wire-fraud on my deposit?

• Call the title or escrow company at a verified phone number to confirm wire instructions, use secure transfer, and never rely only on emailed directions.