How much earnest money must be submitted with a valid purchase and sale?

• A. Required amount for all transactions
• B. No EM is required
• C. At least $1,000
• D. May be held by the broker

Answer: (B)

Earnest money shows the buyer’s serious intent and gives the seller a measure of security, but there is no statutory requirement in Washington that a buyer must submit any amount to make a purchase and sale valid. The amount, if any, is negotiated by the parties and included in the contract. If earnest money is provided, it’s usually placed in a broker’s trust account and applied to the purchase price at closing, or treated as specified in the contract if there’s a breach. If no earnest money is required, the contract can still be valid and enforceable so long as the parties intend to be bound; the absence of a deposit simply means there are no funds to hold or liquidate in case of breach.