Worried about losing your deposit when you make an offer in Orlando? You are not alone. Earnest money can feel confusing, especially if you are a first-time buyer or moving in from out of town. In a few minutes, you will understand how earnest money works in Orange County, what is typical in today’s market, the timelines that matter in the FAR/BAR contract, and smart ways to protect your funds while keeping your offer competitive. Let’s dive in.
What earnest money is and who holds it
Earnest money is your good-faith deposit that shows a seller you are serious about buying. It also protects the seller if you default under the contract. In Florida, the deposit is held by the escrow agent named in your contract. This is commonly a title company, a closing attorney, or sometimes the seller’s broker escrow account.
The funds stay in escrow until closing or until both parties agree to release them. Your contract will spell out who holds the funds, when they are due, and when they can be released.
Typical amounts in Orlando
There is no legal minimum for earnest money in Florida. In practice, buyers in the Orlando area often use either a flat dollar amount for lower-priced homes or a small percentage of the purchase price for higher-priced homes. A common range is 1 to 3 percent, but market conditions can push this higher.
Several factors shape what makes sense for you:
- Purchase price and loan type. Conventional, FHA, and VA loans can come with different timelines and comfort levels for sellers.
- Competitiveness. Multiple offers often lead to higher deposits.
- Seller expectations and property demand. A well-priced Lake Nona home can draw a different deposit than a condo near downtown.
- Where the funds are held. Some sellers prefer a neutral title company over a broker escrow account.
- Your risk tolerance. Larger deposits can strengthen an offer but raise your potential forfeiture if you default under the contract.
The best number for your situation is the one that balances appeal to the seller with your comfort level and the protections in your contract.
How and when you pay
Your contract sets the timing. It may require the deposit with the offer or within a set number of days after mutual acceptance. In Orlando, it is common to deliver the initial deposit to a title company within a few days of acceptance. Always confirm the exact deadline in your signed contract and get proof of deposit.
Common payment methods include personal check, certified or cashier’s check, and wire transfer to the escrow account. Wire transfers are fast, but wire fraud is a real risk. Before sending funds, verify wiring instructions by calling the title company at a trusted phone number you find independently. Do not rely only on emailed instructions.
Key FAR/BAR deadlines to watch
Many Orlando contracts use the Florida Realtors and Florida Bar residential contract, often called the FAR/BAR contract. The form lets you negotiate exact timelines. The dates you fill in control the deal, not assumed defaults. For general background on the form and its use statewide, review the FAR/BAR contract guidance from Florida Realtors.
Here are common windows you will see in practice. Always confirm what your contract says:
Inspection period
You usually have a 7 to 15 day inspection period. In that time, you can complete inspections and either proceed, request repairs, or cancel if the contract allows. To protect your deposit, give any required notices before the deadline, using the method described in the contract.
Financing and appraisal
The financing approval period is often 15 to 30 days. Appraisal usually ties to financing. Your lender needs an appraisal that supports the loan within that timeline. If you do not obtain loan approval by the deadline and you have not extended it in writing, you could lose protection for your deposit.
Title and HOA review
Title evidence and the right to object are commonly 10 to 30 days, depending on what you negotiate. Condo and HOA document review periods are often 7 to 15 days. These windows let you review the title commitment and association documents and object or cancel within the stated time.
Earnest money delivery
Your contract states when your initial and any additional deposits are due. Missing these deadlines can be a default under the contract. Confirm whether your days are calendar or business days and what counts as day one.
Time is of the essence
In many FAR/BAR versions, time is of the essence for key deadlines. That means a missed deadline can change your rights to terminate or to recover your deposit. Read the specific version you are using and follow it closely.
How to protect your deposit
You can limit risk with clear contract terms and organized follow-through. Consider these steps:
- Specify a neutral escrow agent. Name a reputable local title company or closing attorney as the escrow holder.
- Write clear deposit terms. State who holds the funds, the exact amount, and when each deposit is due.
- Tie protection to contingencies. Make your deposit refundable if you cancel within your inspection, financing, appraisal, title, or HOA review periods as allowed by the contract.
- Define the calendar. Specify whether days are calendar or business days and what counts as day one.
- Keep your receipts. Save the signed contract sections on earnest money, wire confirmations, check receipts, and emails. They matter if a dispute comes up.
- Right-size your windows. Choose inspection and financing periods that fit your needs and lender timeline while still being acceptable to the seller.
- Understand liquidated damages. If your contract includes a liquidated damages option for seller remedies, the seller may keep the deposit if you default. Know what you are signing.
If you have questions about legal remedies or a large deposit, consider seeking an attorney. You can locate Florida real estate attorneys through The Florida Bar.
Make a strong offer without extra risk
You can compete without putting your deposit on the line. Here are practical strategies:
Use a staged deposit. Offer a modest initial deposit with a larger additional deposit due shortly after acceptance. This signals commitment while easing upfront cash.
Shorten, but protect, your inspection period. A shorter window can appeal to sellers, but keep the right to cancel within that period if needed.
Clarify appraisal options. If your lender needs an appraisal, be clear on what happens if it comes in low. Some buyers use an appraisal gap with a capped amount, while keeping financing protections intact.
Strengthen your pre-approval. A clean, current pre-approval letter shows the seller your financing is realistic, which can help you win without over-pledging earnest money.
Name a trusted local title company. Familiar local escrow holders can increase seller confidence and help your offer stand out.
Ask what matters most. Have your agent check what the seller values most. Sometimes a flexible closing date beats a higher deposit.
What happens in a dispute
If a dispute arises, start by requesting a mutual written release that directs the escrow agent to return funds. Escrow agents follow the contract and escrow instructions. If the parties do not agree, the title company will usually hold the funds until it receives a mutual release or a court order.
The FAR/BAR form includes dispute resolution provisions. Depending on what you initialed or agreed to, next steps may include mediation, arbitration, or litigation. If significant sums are at stake, consider speaking with a Florida real estate attorney about your options.
Orlando market context to keep in mind
Orlando is a dynamic market with seasonal swings. Relocation and vacation home activity can increase competition at certain times of the year. Neighborhood demand, property type, and price tier all influence the deposit size and timelines sellers expect.
Local listing agents and title companies see these shifts firsthand. Lean on their input to match your deposit, contingency windows, and escrow setup to the micro-market around the home you want.
A simple game plan
- Decide a deposit range you are comfortable with, based on price and risk.
- Choose a respected local title company to hold escrow.
- Set inspection, financing, appraisal, and title deadlines that fit your goals and lender timeline.
- Verify all wiring by phone using a known phone number.
- Keep copies of everything and calendar all dates.
This approach helps you protect your earnest money while writing an offer that wins.
Ready to move with confidence?
You deserve a clear plan and a smooth process. If you want help tailoring a winning offer in Orlando, from Belle Isle to Doctor Phillips to Lake Nona, let a local expert guide you through deposit strategy, timelines, and escrow setup. Reach out to James Tima for a focused, step-by-step path to your next home.
FAQs
How much earnest money is typical for Orlando buyers?
- There is no legal minimum. Many buyers use a flat amount on lower-priced homes or 1 to 3 percent on higher-priced homes, adjusted for market conditions and seller expectations.
Who holds earnest money in a Florida home purchase?
- The escrow agent named in your contract, often a title company or closing attorney, holds the funds until closing or release under the contract.
When is my deposit due after an offer is accepted?
- Your contract controls the timing. Many deals call for delivery to the title company within a few days of mutual acceptance. Always verify your exact deadline and get proof of deposit.
Can I get my earnest money back after a bad inspection?
- Usually yes, if your contract includes an inspection contingency and you cancel within the inspection window using the required notice method.
What if I cancel after contingencies expire?
- If you terminate after your protection periods, you may forfeit the deposit under the contract’s remedy terms. Review the liquidated damages and remedies clauses and consult an attorney for substantial sums.
How do earnest money disputes get resolved in Florida?
- Escrow agents follow the contract. Disputes may be resolved by mutual release, mediation or arbitration if your contract requires, or a court order. Title companies typically will not disburse disputed funds without agreement or a court order.
Is wire transfer safe for earnest money in Orlando?
- It can be, if you verify wiring instructions by phone using a trusted number and never rely only on email. Confirm the escrow account details directly with the title company before sending funds.
What contract is standard in Orlando and why does it matter?
- Many agents use the FAR/BAR residential contract. It sets your deadlines for inspection, financing, appraisal, title, and HOA review, which determine if and when your deposit is refundable. For an overview, see Florida Realtors’ FAR/BAR resources.
