You found the right home in Columbus, and you are ready to write an offer—but how much earnest money should you put down, and what happens to it if things change? It is a common question, and getting it right can protect your budget and strengthen your offer. In this guide, you will learn how earnest money works in Ohio, typical amounts around Franklin County, when it is refundable, and how to avoid disputes. Let’s dive in.

What earnest money is

Earnest money is a good faith deposit you pay after the seller accepts your offer. It shows you are serious and gives the seller some protection if you breach the contract. At closing, the deposit is usually applied to your down payment and closing costs.

In Ohio, the rules for earnest money mostly come from the purchase contract and the escrow holder’s policies. There is no set statewide amount required by law. What you agree to in writing controls how the money is held, when it is due, and how it can be released.

Typical amounts in Columbus

In many Franklin County transactions, you will see two common patterns:

• $1,000 to $5,000 for lower-priced homes or early-stage buyers.
• About 1 to 3 percent of the purchase price as a general rule in normal markets. In hot areas, buyers sometimes offer 3 to 5 percent or more to stand out.

Neighborhood demand can influence the deposit. Popular Columbus areas like Short North, German Village, parts of Clintonville, and Bexley often see stronger offers. A larger deposit can help your offer compete, but it also increases what you might forfeit if you lose refund rights later. Choose a number that is competitive and comfortable for you.

Who holds the funds

In Ohio, a neutral title or escrow company commonly holds earnest money. Some contracts name the listing broker as the escrow holder. In fewer cases, a buyer’s broker may hold it. Your contract should name the holder and include clear deposit instructions.

Ask your agent which title company or escrow holder is typical for your situation. Many Columbus transactions close through established title companies, which helps keep the process consistent and documented.

When to deposit

Most Columbus purchase agreements require you to deposit earnest money within 24 to 72 hours after both parties sign the contract. In fast-moving situations, you may see a 24 to 48 hour window. The contract should state the exact deadline.

You can usually deposit by certified check, personal check that must clear, or wire transfer. If you wire funds, protect yourself from fraud. Confirm wiring instructions by calling a known phone number for the escrow holder, and never rely only on email for final instructions.

When it is refundable

Whether your earnest money is refundable depends on your contract and how you follow the timelines. Common contingencies that protect a refund include:

• Inspection: You can cancel within the inspection period if the contract allows, often with prompt written notice.
• Financing: If your loan is denied within the stated timeline and you give proper notice, the deposit is usually refundable.
• Appraisal: If the appraisal is below the price and you follow the contract remedy, you can often cancel and get a refund.
• Title: Uncured title defects before closing can allow a refund.
• Sale-of-home: If included, refund terms depend on the exact clause and deadlines.

The key is timing. If you miss a notice deadline, you may lose protection and risk forfeiting the deposit. Track every date and deliver required notices in the method the contract specifies.

Clauses to watch

A few provisions in Ohio purchase agreements can change your risk:

• Liquidated damages: Many contracts let the seller keep the earnest money as liquidated damages if you breach. If enforceable, this can be the seller’s main remedy.
• Mutual release: Escrow holders typically require a written, signed release from both buyer and seller before they disburse funds.
• Time is of the essence: This language means deadlines matter. Missing an inspection, financing, or appraisal deadline can put your deposit at risk.

Ask your agent to explain any clause that impacts how and when the deposit can be kept or returned.

How releases and disputes work

Escrow holders usually will not release earnest money unless one of these applies:

• Both parties sign a written mutual release.
• A court order or formal disbursement order is provided.
• The contract spells out an automatic release event.

If there is a disagreement, you and the seller can try to settle or mediate. If you cannot agree, the contract may allow arbitration or a lawsuit. In Franklin County, a court can decide who is entitled to the funds, and an escrow holder can file an interpleader to let the court hold the money while it is resolved. There is no fixed statewide timeline for holding disputed funds, so they can sit in escrow until there is an agreement or order.

Smart ways to strengthen your offer

You can make your offer more competitive without adding unnecessary deposit risk. Consider these options:

• Provide a strong lender pre-approval.
• Offer a timeline that fits the seller’s needs.
• Tighten, but do not remove, key contingencies unless you fully accept the risk.
• Use a reasonable inspection period with clear, prompt communication.

A larger deposit can help, but it should not be your only lever. Balance risk against your goals and the home’s condition.

Columbus-specific tips

• Ask what is customary in the micro-market. Bexley, German Village, Short North, and Clintonville can see higher deposits in multiple-offer scenarios.
• Confirm the escrow holder before you sign. In the Columbus area, title companies commonly hold the deposit and close the transaction.
• Keep documentation. Save your deposit receipt, escrow confirmation, inspection reports, appraisal and loan letters, and copies of every notice.

Small process steps can make a big difference if you need to cancel within a contingency or request a refund.

Wire and payment safety

Wire fraud has targeted real estate deposits and closing funds. Protect yourself by:

• Verifying wiring instructions by phone using a known, trusted number.
• Avoiding last-minute emailed changes to instructions.
• Using secure, traceable methods and confirming that funds arrived.

A few extra minutes of verification can prevent major loss.

Buyer checklist

Use this quick checklist to stay on track in Columbus and throughout Franklin County:

• Decide your deposit amount and source of funds before you write the offer.
• Name the escrow holder in the offer and include the deposit deadline.
• Choose your deposit method and confirm instructions by phone.
• Keep inspection, financing, appraisal, and title contingencies unless you accept the risk of waiving them.
• Track every deadline and send any termination or objection in writing as the contract requires.
• Save all receipts, notices, and confirmations.

If a dispute arises

Start by talking to your agent and the seller’s side to seek a mutual release. If that does not work, review the contract for mediation or arbitration options. You can also speak with a local real estate attorney about next steps. Remember that litigation can be time-consuming and costly, so many parties aim for a settlement.

The bottom line

Earnest money in Ohio is a powerful tool. It shows commitment and can help your offer win in competitive Columbus neighborhoods. The same deposit can also be at risk if you miss deadlines or waive key protections. Choose an amount that fits the market and your comfort level, follow your contract to the letter, and keep strong documentation.

If you want one-on-one guidance on deposit strategies, contingencies, and timing for your specific Columbus search, connect with Michelle Balzer for local advice tailored to your goals.

FAQs

What is earnest money in an Ohio home purchase?

• It is a good faith deposit you pay after the seller accepts your offer, held in escrow and typically applied to your down payment and closing costs at closing.

How much earnest money is typical in Columbus?

• Many buyers put down $1,000 to $5,000 or about 1 to 3 percent of the price; hotter areas sometimes see 3 to 5 percent to compete.

Who holds earnest money in Franklin County?

• A title or escrow company commonly holds it, though the contract may name the listing broker or, less often, the buyer’s broker.

When is earnest money refundable in Ohio?

• It is usually refundable if you cancel within protected contingencies like inspection, financing, appraisal, or title, and you follow the contract’s notice rules on time.

What happens if there is a dispute over the deposit?

• Escrow holders need a mutual release, a court order, or a contract trigger to disburse funds; if parties cannot agree, mediation, arbitration, or a court case can decide.

Should I waive contingencies to win in Columbus?

• You can, but it raises risk; consider stronger pre-approval, flexible timing, and a reasonable deposit before waiving protections that safeguard your earnest money.