Short Answer
A common earnest money deposit is around 1% of the price, rounded to the nearest thousand. Alex Mayer calls it skin in the game, and the amount depends on the negotiation and the competition.
What Earnest Money Is
Skin in the Game
Alex tells clients it is the money you give to the listing agent’s brokerage. It shows the seller there is an agreement in place.
It Is Part of Your Money, Not an Extra Fee
At closing, the deposit goes toward your down payment or closing costs. You are moving money you already planned to spend.
How Much Earnest Money to Offer
A Common Amount Is About 1%
Most deposits are around 1% of the price, rounded to the nearest thousand. On a $300,000 purchase, that is about $3,000.
Negotiation and Competition Change It
Everything going on in the negotiation matters, especially the other offers. Alex helps you choose an amount that fits your offer and your comfort level.
When You Pay It
Within Two Business Days
Earnest money is deposited within two business days of a fully signed purchase agreement. Alex tells you where it goes and confirms it arrived.
When You Get Earnest Money Back
Generally Refundable With a Contingency
Your deposit is generally refundable if you cancel because of an inspection contingency or a financing contingency. The dates are in your purchase agreement.
Inspection Contingency
In Minnesota, the buyer can cancel for any reason during the inspection contingency. Only the buyer can.
Financing Contingency
If your loan cannot be approved as the contract describes, the deposit is generally protected.
When a Buyer Could Lose It
A buyer could lose the deposit by getting cold feet midway through the transaction and canceling outside a contingency. That is why Alex builds your timeline on day one.
How Alex Mayer Teaches Earnest Money
Education
Alex’s first-time buyer consult runs before you tour a single home. You learn how the deposit works before you need it.
Communication
He tells you where the deposit goes, by when, and what happens next. No update is still an update.
Responsiveness
Mike Hagen and his partner wrote an offer against multiple other offers. They credited Alex’s knowledge of the offer process for helping them structure it the right way.
When You Call Alex, Alex Answers
Alex works through his Direct Representation Model. The agent who explains your deposit is the same agent who writes and negotiates your offer.
I built my support around my representation, not between me and the client.
If you have a question about your deposit or a deadline, you call Alex. He responds fast, often within minutes.
What Clients Say About Alex
Testimonial on Alex: one first-time homebuyer said this about having the terms explained simply.
Alex set up a phone call and then took the time to sit down with me, go through all the steps, explain the terms simply, and set clear expectations.
Kirsten Fieck, first-time homebuyer, SoTellUs review
Frequently Asked Questions
How Much Earnest Money Should I Offer in Rochester MN?
A common amount is around 1% of the price, rounded to the nearest thousand. Alex helps you set it based on the negotiation and the competition.
Is Earnest Money the Same as a Down Payment?
No. Earnest money is a deposit after your offer is accepted, and it counts toward your purchase at closing. Your down payment is a separate, larger amount.
Who Holds My Earnest Money?
You give it to the listing agent’s brokerage. It does not go to the seller directly.
Can I Get My Earnest Money Back?
Generally yes, if you cancel because of an inspection or financing contingency. A buyer could lose it by canceling outside a contingency.
When Is Earnest Money Due?
Within two business days of a fully signed purchase agreement. Alex gives you the exact date.
Do I Pay Earnest Money if I Use a Loan?
Yes, most buyers do whether they finance or pay cash. The deposit is part of the offer.
About Alex Mayer
Alex Mayer is a full-time Rochester MN real estate agent, a 4X winner of Best Real Estate Agent in Rochester MN with 350+ five-star reviews. His core values are Education, Communication, and Responsiveness, which guide every part of his business.
He has a “Direct Representation Model,” meaning his clients work directly with him, not a large team with junior agent handoffs. His promise: you’ll know what to expect, how to operate, and what needs to be done to be successful in the Rochester MN real estate market.
He specializes in first-time homebuyers, Mayo Clinic and other relocating buyers, and Rochester MN sellers, including move-up, downsizing, and estate sales. Alex is also known for his Alaskan Malamute dogs, Atlas and Kaia, who are featured in much of his local branding.