Earnest Money in South Carolina: What Buyers Should Know

You find a great home in Fort Mill and you’re ready to make an offer. Then your agent brings up earnest money and you start to wonder how much to put down, when it is refundable, and what happens if something goes wrong. You are not alone. This small but important deposit can make your offer stronger and also protect you if your contract includes the right safeguards. In this guide, you will learn how earnest money works in South Carolina, what to expect in Fort Mill, and how to protect your deposit from contract to closing. Let’s dive in.

Earnest money basics

Earnest money is a good-faith deposit you include with an offer to purchase a home. It shows the seller you are serious and plan to complete the purchase. If you close, the deposit is typically credited toward your down payment or closing costs on your final closing statement.

This deposit serves a few purposes:

• It signals commitment to the seller and can strengthen your offer.
• It provides some protection to the seller if a buyer walks away without a valid contractual reason.
• It sits in escrow and is disbursed according to the purchase contract if a party defaults or the deal is terminated.

How much to offer in Fort Mill

There is no one-size amount. Local custom in Fort Mill and the greater Charlotte suburbs often follows these ranges:

• For lower-priced homes, a few thousand dollars is common.
• For higher-priced or competitive listings, a typical guideline is 1% to 3% of the purchase price.

In hotter segments near Charlotte, some buyers choose larger earnest deposits to stand out. A larger amount can strengthen your offer, but it also increases your exposure if you default outside your contingencies. Balance competitiveness with a number you are comfortable placing at risk under your specific contract terms.

Where your deposit is held in South Carolina

In South Carolina, your purchase contract specifies who will hold the funds. That can be the listing brokerage, your brokerage, a buyer’s or seller’s attorney, or a title/closing attorney. The funds should be placed in a trust or escrow account per professional rules.

• Confirm in writing who will hold the funds and that they use a trust account.
• Obtain a receipt when you deliver the deposit.
• If wiring the funds, verify instructions by calling a known phone number for the holder. Wire-fraud scams are common in real estate.

Contracts set the rules in SC

Your South Carolina contract governs everything about earnest money. Standard forms used across the state, including the South Carolina REALTORS and South Carolina Bar “Offer to Purchase and Contract,” outline how much is due, when it is due, what contingencies apply, and how disputes are handled.

Key items to confirm in your contract:

• Deadline for deposit. Many contracts require delivery within 24 to 72 hours after acceptance. Verify the exact timeframe written in your offer.
• Contingencies. Inspection, financing, appraisal, title, and HOA review are common protections that define when you can terminate and recover your deposit.
• Dispute procedures. Standard contracts often require a mutual release, mediation or arbitration language, or allow a court to decide if parties cannot agree. Some holders will not release funds without both parties’ written consent or a court order.
• Remedies for default. Some contracts include a liquidated damages clause that lets the seller keep the earnest money as the sole remedy if the buyer defaults. This only applies if your contract contains that clause.

When earnest money is refundable

Your deposit is typically returned if you terminate within the contract’s protection periods and follow the notice rules exactly. Common refundable scenarios include:

• You terminate within the inspection period per the contract’s process.
• Your financing contingency is not met and you provide timely written notice, such as a lender denial letter, as required by the contract.
• The appraisal contingency is not met and you choose to terminate within the contract’s timeframe.
• The seller cannot deliver marketable title or otherwise materially breaches the contract.
• HOA or title review reveals issues and you cancel within the allowed window.

In each case, timing and documentation matter. Keep all notices and proof that you followed the contract.

When you could lose your deposit

The seller may seek to keep your earnest money if you default outside your contract protections. Risky scenarios include:

• You back out for a reason not covered by a contingency.
• You miss a deadline to inspect, request repairs, or deliver a termination notice.
• You fail to deliver the earnest money on time. Depending on your contract, the seller may have remedies.

Small procedural missteps can have big consequences. Follow the exact notice requirements in your contract to preserve your rights.

Fort Mill buyer protections that work

You can make a strong offer while still protecting your deposit. Use these practical steps in Fort Mill:

• Set a smart deposit. Match the market while choosing a number you can risk if you default outside your contingencies. For many homes, 1% to 3% is competitive.
• Name the escrow holder. List the specific broker or attorney in your contract and confirm their trust-account procedures.
• Use clear contingencies. Include inspection, financing, appraisal, title, and HOA review where applicable. Set realistic deadlines that give you time to complete due diligence.
• Spell out notice delivery. Clarify who receives notices and how you will deliver them. Then follow that process.
• Verify wiring. Call a known number to confirm wiring instructions before sending funds. Do not rely solely on email.
• Get receipts. Whether you deliver a check or wire, ask for a written acknowledgment of receipt.
• Keep records. Save inspection reports, lender communications, appraisals, and all notices in writing.

Handling disputes over earnest money

Most escrow holders will require both parties to sign a mutual release before disbursing funds. If you cannot agree, contracts often direct you to mediation, arbitration, or court. In some cases, the escrow holder may file an interpleader action so a judge can decide who receives the deposit.

If you suspect a broker mishandled trust funds, you can speak with your agent and a real estate attorney about next steps. South Carolina licensees must follow strict trust-account rules, and misuse of funds can be reported to the South Carolina Real Estate Commission.

Step-by-step checklist for buyers

Use this quick list to stay organized from offer to closing:

1. Before you offer

• Decide on a competitive but comfortable deposit amount for the property and market segment.
• Discuss appropriate contingencies and timelines with your agent so you have enough time for inspections and loan approval.

2. When you write the offer

• Specify the escrow holder by name and confirm trust-account procedures.
• Set clear deposit timing, usually within 24 to 72 hours after acceptance.
• Include detailed notice instructions for all contingencies.

3. After acceptance

• Deliver the earnest money using a secure method and get a receipt.
• Schedule inspections right away and monitor all contingency deadlines.
• Keep written records of all reports and communications.

4. If an issue arises

• Send notices in writing before deadlines, following the contract’s delivery instructions.
• If the seller disputes a refund, request a mutual release and consult your agent and a real estate attorney on next steps.

Fort Mill context to keep in mind

Fort Mill is a popular York County community for Charlotte-area buyers. In competitive situations, you may see larger deposits and shorter timelines. That is why it helps to set a strong, well-protected offer from the start. A clear contract, a defined escrow holder, and realistic contingency windows can give you an edge while protecting your funds.

Final thoughts

Earnest money is a small part of the purchase price, but it carries outsized importance. In South Carolina, your contract controls whether and when your deposit is refundable. If you set the right amount, choose a trusted escrow holder, and follow every deadline and notice step, you will be well positioned to compete in Fort Mill while keeping your risk in check.

Ready to plan your next move in Fort Mill or across the Charlotte metro? The Ordan Reider Group pairs local insight with a clear, organized process that keeps you protected from offer to closing. Start your next move with a trusted team — let’s talk.

FAQs

How much earnest money should I offer in Fort Mill?

• For many homes, a few thousand dollars is common. In competitive or higher-priced situations, 1% to 3% of the purchase price is a typical guideline.

Who usually holds earnest money in South Carolina?

• Your contract specifies the holder. It can be a brokerage, a buyer’s or seller’s attorney, or a title/closing attorney. Confirm the funds will be placed in a trust account and get a receipt.

If my loan is denied, do I get my deposit back?

• If you have a financing contingency and you terminate by the deadline with proper written notice, the deposit is typically refundable under the contract.

What if the appraisal comes in low in Fort Mill?

• With an appraisal contingency, you can renegotiate, bring additional cash, or terminate within the allowed timeframe and seek a refund. Without that contingency, you may risk forfeiture if you cannot close.

Can the seller keep my earnest money if I change my mind?

• Possibly. If you do not have a valid contractual reason to terminate, the seller may seek to keep your deposit or pursue other remedies, depending on the contract language.

How quickly must I deposit earnest money in South Carolina?

• Many contracts require delivery within 24 to 72 hours after acceptance. Check your contract for the exact deadline and plan to deliver earlier when possible.

Does earnest money count toward my down payment at closing?

• Yes. At closing, your deposit is usually credited toward your funds to close, which can include your down payment and closing costs.

How can I avoid wire-fraud scams when sending my deposit?

• Call a trusted phone number for the escrow holder to verify wiring instructions before you send funds. Do not rely on email instructions alone and avoid responding to wiring changes received by email.

What happens if the seller and I cannot agree on who gets the deposit?

• The escrow holder will usually require a mutual written release or a court order. Contracts often call for mediation or arbitration, and in some cases the holder may file an interpleader action so a court can decide.

What is a liquidated damages clause in my contract?

• It is a clause that may allow the seller to keep the earnest money as the sole remedy for buyer default. This only applies if the clause is in your signed contract.