Wondering how much earnest money you need to compete for a home in Mountain View? You are not alone. Between high prices and multiple-offer situations, the deposit piece can feel confusing and high stakes. In the next few minutes, you will learn what earnest money is, typical local amounts, how and when you pay it, how contingencies protect you, and when funds can become non-refundable. Let’s dive in.
Earnest money basics in Mountain View
Earnest money is your good-faith deposit that shows a seller you are serious and ready to move forward. The funds are held by a neutral escrow or title company. If you close, the deposit is applied to your down payment or closing costs.
In Silicon Valley, custom and contract language guide the process. Local agents typically use the California Association of Realtors purchase agreement and escrow instructions. Your deposit amount, delivery timeline, and refund rules come from that contract.
Typical deposit amounts
There is no fixed rule for how much to offer, but there are common ranges. In many markets, 1 to 3 percent of the purchase price is typical. In competitive Peninsula areas like Mountain View, buyers often use larger deposits, such as 3 to 5 percent or more, to strengthen an offer.
Because home prices are high, even small percentages equal large dollar amounts. For example, on a $1,500,000 home, 1 percent is $15,000 and 3 percent is $45,000. These numbers are illustrative, not requirements, and the right number for you depends on the property and competition.
How and when you deliver funds
Your initial deposit is usually due soon after your offer is accepted, often within 24 to 72 hours or within three business days, as stated in the contract. Escrow will give you instructions for delivery.
You can typically wire funds, deliver a cashier’s check, or have your agent coordinate the deposit. Wired funds are common for speed. Always verify wiring instructions by phone using a known, independently verified number. Once escrow receives and deposits the funds into a trust account, you will get confirmation.
Some contracts include an additional deposit due later, such as within 7 to 10 days after acceptance. The contract will specify if there is a second deposit and when it is due.
Contingencies that protect your deposit
Contingencies give you time to confirm key details and protect your deposit if you need to cancel within the agreed period. Common ones include:
- Inspection contingency to assess property condition and negotiate or cancel within a set window.
- Appraisal contingency to address a valuation that comes in below the purchase price.
- Loan or financing contingency if you cannot obtain your mortgage on agreed terms.
- Title and HOA document review contingencies, when applicable.
Each contingency has a removal deadline. If you cancel within a valid contingency period and follow the contract’s procedures, your deposit is typically refundable.
When deposits become non-refundable
As a general rule, your earnest money is at risk once you remove or waive your contingencies. After that point, if you fail to perform, the deposit is usually forfeited to the seller according to the contract’s terms.
Some sellers request language that makes the deposit non-refundable at acceptance or after a short period. This increases seller certainty but raises buyer risk, especially if issues arise with inspection, appraisal, or lending. If the seller fails to perform, you usually have the right to recover the deposit. In disputes, escrow will hold funds until there is a mutual written release or court order.
Local offer strategies in Mountain View
In multiple-offer situations, sellers often look for signals that the deal will close smoothly. Common strategies include:
- Larger initial earnest money to show commitment.
- Staged deposits, for example a smaller initial deposit followed by a larger one upon removing certain contingencies.
- Shorter inspection periods, often 5 to 7 days, so you can complete due diligence quickly.
- Waiving appraisal only if you can cover a shortfall in cash or have top-tier financing.
- An appraisal gap approach where you agree to cover part of a valuation shortfall while keeping your loan contingency.
- Flexible closing or a seller rent-back to match the seller’s timeline.
These tactics can be effective, but they also increase risk. Align your approach with your comfort level and funding capacity.
A quick scenario
You offer on a Mountain View home at $1,500,000 with a 2 percent earnest money deposit and a 7-day inspection contingency. Escrow receives your deposit within 48 hours. During inspection, a major roof issue appears. You notify the seller within the contingency period and follow the contract steps. The parties cannot agree on credits, so you cancel within the deadline. In this scenario, your deposit is typically returned because you acted within a valid contingency window and documented the process.
Smart steps before you write an offer
- Get a fully documented mortgage preapproval and have your deposit funds ready to move.
- Talk with your agent about typical earnest money ranges for the neighborhood and property type.
- Decide how much you can responsibly put at risk if contingencies are removed.
- Set realistic contingency timelines so you can inspect, appraise, and complete underwriting.
- Verify wiring details by phone with the escrow or title office before sending any funds.
Avoid common pitfalls
- Agreeing to non-refundable terms at acceptance without understanding the risk.
- Waiving financing protection before your lender has reviewed documents and confirmed your profile.
- Sending a wire based on email instructions without direct phone verification.
- Skipping or rushing inspections, then facing unexpected repair costs later.
Work with a local advocate
A thoughtful deposit strategy can help you win the home without taking on unnecessary risk. If you want a calm, clear plan for earnest money, contingencies, and negotiation in Mountain View, work with an experienced local agent who knows how sellers think and how escrow operates here.
Ready to talk through your options and tailor a strategy to your goals? Connect with Lynne Mercer for a friendly, focused consultation.
FAQs
How much earnest money is typical in Mountain View?
- There is no fixed rule. Many buyers use larger deposits in competitive situations, often in the 3 to 5 percent range, though amounts vary by property and competition.
When do I have to deliver my earnest money deposit?
- Your contract sets the deadline. Common practice is within 24 to 72 hours after acceptance, and escrow will confirm receipt.
Is my earnest money safe once escrow has it?
- Yes. Licensed escrow or title companies hold deposits in trust accounts and release funds only according to the contract or a court order.
When can I get my deposit back if I cancel?
- If you cancel within a valid contingency period and follow all contract procedures, your deposit is typically refundable.
Can a seller keep my deposit if they do not perform?
- If the seller fails to perform, you usually have the right to recover the deposit or pursue other remedies based on the contract.
Should I agree to make my deposit non-refundable at acceptance?
- Proceed with caution. Some buyers accept limited non-refundable terms later in the process, but making funds non-refundable at acceptance can expose you to financing or inspection risk.
