Lori Ann Alvarez, Lineage Realty Group

06/19/2026

If an FHA borrower is approved for a mortgage with a 6% interest rate, the actual figure might be listed at 6.8%. The difference between those two numbers represents upfront fees and monthly mortgage insurance premiums.

06/19/2026

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06/16/2026

06/09/2026

LINEAGE REALTY GROUP. Personalized service. Local expertise. Tailored results. Because your real estate journey deserves more than a one-size-fits-all approach. 🏡✨

05/30/2026

Congratulations to my wonderful friends on the purchase of their beautiful new home. It was an honor to guide you through the process and be part of this exciting chapter.

Welcome back to Hollister! We’re so happy to have you close and wish you many years of happiness, memories, and new adventures in your new place. 🏡❤️

Ted, Thank you for trusting me as your realtor—it means the world to me!

05/25/2026

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05/20/2026

Buying a home can feel overwhelming, but it doesn’t have to be! This snapshot guide walks you through every step of the home-buying process from pre approval to closing.

 

05/05/2026

Visit out website to learn more about us,search homes in your area and catch up on our latest blogs.

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What is the Earnest Money Deposit?

Earnest Money Deposit

Of course you know that you’ll need to pay a down payment on any home you hope to purchase with a mortgage (unless you’ll be using a VA or USDA home loan). But, did you know that you will also need cash for an “earnest money deposit?” Indeed you will, and it’s a fact that surprises many first-time homebuyers.

While the down payment is a lender requirement, the earnest money deposit is for the seller, and it shows him or her that you are earnest in your desire to purchase the home. Because you now have skin in the game, the seller can relax a little as the home comes off the market.

The amount of an earnest money deposit varies; there is no law dictating how much it should be. Therefore, it varies, according to region. Let’s take a look at how the amount of this deposit is usually determined.

Liquidated Damages

Buried within most pre-printed real estate purchase agreements is a clause known as “Liquidated Damages.” This concept is defined well by Bob Hunt, former director of the National Association of Realtors and author of "Real Estate the Ethical Way." Hunt says that “A liquidated damages clause sets in advance - at the time of contract formation - what the monetary value of damages shall be in the event of contract breach by one of the parties.”

In other words, if the buyer fails to complete the transaction according to the agreement, the seller agrees not to sue but to keep whatever amount of money the parties have determined will cover damages.

So, what do liquidated damages have to do with your earnest money deposit? If you default on the purchase of the home, this deposit will be forfeited as liquidated damages. Therefore, an experienced listing agent will insist that the amount of the earnest money deposit is equal to the percentage of the sales price listed as liquidated damages.

How Much?

As mentioned earlier, the amount of earnest money you’ll need to deposit varies by region. There are other caveats that vary as well. For instance, one percent of the purchase price may be standard in many regions but the buyer is typically asked to increase the deposit to equal three percent after the removal of contingencies.

Your real estate agent can structure the offer to purchase to keep this deposit as low as possible.

LineageRealtyGrp.com - Richard Vasquez, Realtor - California Real Estate

04/29/2026

LineageRealtyGrp.com - Richard Vasquez, Realtor - California Real Estate

04/29/2026

In part 1 of our relocation guide we talked about preparing for the big move and how important it is to get clear on exactly what you want in not only a new home, but in a neighborhood as well. Now it's time to consider the financial implications involved in relocating to a new area. Let's go surfin...