Earnest Money in Lamorinda: What Buyers Should Know

Wondering how much earnest money you need to compete for a Moraga home? You are not alone. In Lamorinda, deposits are a key part of a strong offer, and they also protect sellers if a deal falls through. When you understand local norms, timelines, and contingencies, you can write a confident offer and keep your funds safe. Let’s dive in.

Earnest money basics in California

Earnest money is your good‑faith deposit that shows a seller you are serious. If you close, it is applied to your purchase price and reduces what you bring to the final signing. If you do not close, what happens to that deposit depends on your contract and timing.

In California, deposits are typically held by an escrow or title company in a trust account. Escrow follows the instructions in your purchase agreement and releases funds only when both sides agree or when the contract says it is allowed. These trust accounts are not the same as your personal bank account. Always verify where your money is going before you send it.

California purchase agreements spell out how the deposit is handled, what contingencies give you an out, and what happens if either side fails to perform. The most widely used form in our area is the CAR Residential Purchase Agreement, which includes fields for deposit amount, timing, and contingency deadlines.

What’s typical in Lamorinda

Lamorinda is a high‑demand market, so you often see deposits at or slightly above general California baselines. As a planning rule, expect to budget at least 1 percent of the purchase price for your earnest money. In practice, local offers often range from 1 to 3 percent, and some buyers choose a higher amount to look competitive.

Here are quick examples:

• Target price $1,000,000: 1 percent deposit = $10,000.
• Target price $1,500,000: 1 percent deposit = $15,000.
• Target price $2,000,000: 1 percent deposit = $20,000.

The exact number depends on the home, the level of competition, and what the seller’s agent is signaling. There is no single Lamorinda standard. Your agent will tailor a strategy based on current conditions in Moraga, Orinda, and Lafayette.

When you pay and who holds funds

Most Lamorinda offers commit to delivering the initial deposit within 24 to 72 hours after offer acceptance. Escrow usually opens right away. Some contracts also include a second deposit due a few days later to bring the total to a target percentage.

Your funds go to a neutral escrow or title company. You can wire the money or deliver a check, then get a receipt. Keep proof of delivery and confirmation from escrow for your records.

Contingencies that protect your deposit

Contingencies allow you to cancel for certain reasons within set timeframes and receive your deposit back. Common ones include:

• Inspection and investigations. Often 7 to 10 days locally, sometimes up to 17 days based on negotiation.
• Loan approval. Commonly 17 days, sometimes 21 days. This should match your lender’s timeline.
• Appraisal. Often tied to your loan contingency so the appraisal report arrives in time for the lender.
• Title and disclosures. Frequently shorter windows aligned with the escrow schedule.

If you cancel within an active contingency and follow the notice rules in your contract, your deposit is generally refundable.

When deposits are refunded or forfeited

Refundable situations are straightforward when you act within your contract.

• You cancel within an active inspection, loan, appraisal, or title contingency and deliver proper notice on time.
• The seller does not perform, such as failing to deliver clear title or other agreed obligations.

Your deposit may be at risk if any of the following occur:

• You remove contingencies in writing, then later default.
• Your contingency window expires and you back out without a contract basis.
• You miss contract funding or performance deadlines without a valid seller‑related issue.

If there is a disagreement, escrow will usually hold the funds until both sides sign a release or a legal decision is made.

Appraisal gaps and loan denial

If the appraisal comes in below the purchase price, your lender may reduce the loan amount. You can try to renegotiate, bring extra cash, or cancel if you have an active loan or appraisal contingency. If you cancel timely under a valid contingency, your deposit is typically returned. If you waived those protections, your deposit could be at risk.

If your loan is denied and you have a valid loan contingency, you must notify the seller within the timeframe and provide any required lender documentation. Done correctly and on time, this usually preserves your deposit. If you removed your loan contingency early, the risk of forfeiture increases.

Wire and escrow safety

Wire fraud is a real concern in real estate. Protect yourself by:

• Calling the escrow or title company at a trusted phone number you source independently to confirm wiring details.
• Double‑checking every digit of the account and routing numbers.
• Avoiding last‑minute changes sent by email. If you receive new instructions, call to verify before sending money.
• Using secure portals if offered by the escrow company.

How much to budget in Moraga

Set aside at least 1 percent of your expected purchase price for earnest money, and be ready to adjust if competition is strong. Remember, this deposit is part of your overall funds to close. You will also need to cover your down payment and closing costs. Make sure your earnest money is liquid, since you will need to send it within a day or two of acceptance.

Here is a quick budgeting checklist:

• Target price and deposit range. Decide on 1 to 3 percent based on strategy and price point.
• Source of funds. Confirm which account will fund your deposit and how you will transfer it.
• Lender timeline. Ask your lender to align appraisal and loan milestones with any proposed contingency deadlines.
• Documentation. Plan to keep your escrow receipt and wire confirmation in one place.
• Backup plan. If you are stretching on timing, discuss whether to use a slightly longer contingency or a two‑step deposit schedule.

Example timeline for a Moraga offer

Every deal is unique, but this sample shows how a Lamorinda purchase often flows:

1. Offer accepted on Monday.
2. Initial deposit due to escrow within 48 hours. You wire funds on Wednesday and receive confirmation from escrow.
3. Inspection contingency set for 7 to 10 days. You schedule inspections immediately and review disclosures.
4. Loan and appraisal contingencies set for 17 days. Your lender orders the appraisal on day 1 and targets loan approval by day 15.
5. Any additional deposit due by day 3 to 5 if your contract includes one.
6. If all checks out, you remove contingencies in writing by the deadlines.
7. Funds to close are wired the day before signing and the deposit is applied to your purchase price.

Smart ways to strengthen your offer

You can write a compelling offer without putting your deposit at unnecessary risk.

• Right‑size your deposit. In a competitive setting, consider a deposit closer to the higher end of your comfort range. Balance this with realistic contingency timelines.
• Tighten where you are confident. If your lender is fast, a 17‑day loan contingency may be fine. If your inspections are already in hand or the seller has recent reports, a shorter investigation period might work.
• Keep critical protections. Waiving appraisal or loan protections can put your deposit at risk. If you are considering it, discuss targeted options like a capped appraisal gap contribution instead of a full waiver.
• Communicate clearly. Clean, complete paperwork and a dependable deposit delivery signal reliability, which can help you stand out.

Next steps

If you are planning to buy in Moraga, Orinda, or Lafayette, the right deposit strategy can make your offer both competitive and safe. A local advisor can help you time your deposit, structure contingencies, and confirm escrow details so there are no surprises.

If you want a calm, hands‑on guide through the Lamorinda process, connect with Gillian Judge Hogan. You will get local insight, step‑by‑step support, and a strategy built for your goals.

FAQs

How much earnest money do Moraga buyers usually put down?

• Many buyers plan for about 1 percent of the purchase price, with 1 to 3 percent common in competitive situations.

How quickly do I need to deliver my deposit after acceptance?

• Most offers in Lamorinda call for delivery within 24 to 72 hours for the initial deposit, often within 48 hours.

Who holds my deposit and is it insured like a bank account?

• Escrow or a title company holds the deposit in a trust account. These are not the same as personal FDIC‑insured accounts, so verify instructions before you wire.

Which contingencies protect my deposit the most?

• Inspection, loan, and appraisal contingencies are the main protections, as long as you act within the deadlines and follow your contract’s notice rules.

What happens to my deposit if the appraisal is low?

• If you have an active loan or appraisal contingency, you can renegotiate or cancel and typically receive your deposit back if you follow contract timelines.

Can the seller keep my deposit if they do not perform?

• No. If the seller fails to perform under the contract, you are generally entitled to your deposit back or other contract remedies.