Earnest Money In Indiana: Brownsburg Buyer Guide

Buying your first home in Brownsburg comes with new terms and timelines, and earnest money is one of the big ones. If you are wondering how much to put down, when it is due, and what happens if a deal falls through, you are not alone. The good news is that earnest money is straightforward once you know the local norms and how the contract protects you. This guide breaks down what to expect in Hendricks County, how to choose the right amount, and the steps to keep your deposit safe. Let’s dive in.

Earnest money basics

What it is

Earnest money is your good‑faith deposit that goes in with your offer to show the seller you are serious. If the sale closes, the deposit is credited to your purchase price and closing costs. It is a contract term, not a state requirement, and the purchase agreement controls how it is handled.

What it is not

It is not your full down payment, although it will be applied at closing. It is not always nonrefundable. Whether you can get it back depends on your contingencies, your deadlines, and the exact language in the contract.

Brownsburg norms and amounts

Local practice in Central Indiana tends to use practical ranges instead of strict percentages. What you offer can vary by price point and how competitive the listing is.

• Entry-level homes: $1,000 to $2,500 is common.
• Mid-priced homes around $200,000 to $400,000: $2,000 to $5,000, often near 1% of the price.
• Higher-priced or multiple-offer situations: 1% to 3% of the price, sometimes more if you want to stand out.

Your ideal amount depends on the home, the number of competing offers, your comfort with risk, and whether you plan to shorten or waive any contingencies. A stronger deposit can help in a hotter segment, but it should still fit your budget and risk tolerance.

Timing and delivery

When it is due

Most Indiana purchase agreements require you to deliver the deposit shortly after acceptance. Standard language often reads within 1 to 3 business days after both parties sign. If you miss the contract deadline, the seller could claim default, so mark this date and plan ahead.

How to deliver

You will send funds by cashier’s check or wire. The contract should name who holds the money, which is typically a title company or a brokerage trust account. Ask for and keep a written receipt that shows the amount, the date, and where the funds are held.

Why timing matters

Quick delivery gives the seller confidence and reduces friction with competing offers. It also keeps you in compliance with the contract so your rights and contingencies stay intact.

Who holds your deposit

Title or escrow company

In many Brownsburg deals, the title company that will close the sale also holds the earnest money. They act as a fiduciary and follow the written escrow instructions in your contract.

Brokerage trust account

Some deposits are held by the listing or buyer’s broker in a separate trust account. Indiana regulations require careful handling and recordkeeping, and you should receive a receipt.

How it is protected

Funds are held in insured accounts with written instructions for how they can be released. If there is a dispute, the holder usually keeps the funds in escrow until both parties sign a release or there is a legal order or agreed resolution.

Refunds and forfeiture

When it is refundable

Your deposit is typically refundable if you cancel within a valid contingency period and follow the contract steps. Common refundable reasons include:

• Inspection contingency during the agreed period.
• Financing contingency if you cannot obtain your loan as outlined.
• Appraisal contingency if the appraisal comes in low and you choose to terminate under the contract terms.
• Title issues that are not resolved as required by the agreement.

When you could lose it

You could forfeit your deposit if you walk away after your contingencies expire or if you fail to meet contract obligations and the seller elects a remedy allowed by the contract. Some agreements include a liquidated damages clause that lets the seller keep the deposit; others preserve the right to pursue other remedies. The outcome depends on the contract and facts.

Disputes and releases

Most escrow holders require a signed release from both parties before disbursing funds. If you cannot agree, the deposit usually stays in escrow until the dispute is resolved through mediation, arbitration if provided, or the courts. Keep detailed records to show you met all deadlines.

Smart buyer checklist

Before you write an offer

• Choose a deposit amount that fits both the current Brownsburg market and your comfort level. For many suburban homes, $1,000 to $5,000 is common, or about 1% for mid-priced homes.
• Decide your delivery method. Have the funds ready as a cashier’s check or confirmed wire.
• Verify the escrow holder in advance and understand the wiring instructions. Confirm by phone using a trusted number to avoid fraud.

What to include in your contract

• The exact dollar amount or percentage of earnest money.
• The escrow holder’s name and delivery timeline. Example: “Buyer will wire funds to the named title company within 2 business days of acceptance.”
• Clear contingency windows for inspection, financing, appraisal, and any HOA or title review. Include how notice must be given.
• Review any liquidated damages and dispute resolution clauses so you understand remedies and next steps if something goes wrong.
• State how the deposit will be applied at closing.

After acceptance

• Deliver funds on time and get a written receipt.
• Track every contingency deadline in writing.
• Keep copies of inspection reports, lender letters, and any notices to terminate or negotiate.

Wire safety tips

• Call the title company using a known, independent phone number to confirm wiring instructions.
• Never rely on email-only instructions or changes.
• Send a small test call to confirm receipt right after you wire and keep your bank confirmation.
• If anything looks off, pause and verify before sending money.

Brownsburg strategy tips

• Match your deposit to the listing’s competitiveness. A tidy, realistic deposit can strengthen your offer without overexposing you to risk.
• Shorter contingency windows can pair well with a stronger deposit, but keep them realistic so you can complete inspections and loan steps on time.
• When in doubt, ask for clarification on any clause that affects your deposit. The contract controls refundability and release.

Ready to move with confidence?

You deserve a clear plan for your earnest money and the rest of your purchase. If you want local guidance on deposit norms, timelines, and how to write a strong Brownsburg offer, we are here to help. Reach out to Sarah Fishburn for hands-on, heart-forward advice tailored to your goals.

FAQs

Is earnest money required for Brownsburg home offers?

• No. Indiana does not require it by law, but sellers expect a deposit and the amount is negotiated in the purchase agreement.

How much earnest money do Brownsburg first-time buyers usually pay?

• Many buyers put down $1,000 to $5,000 on suburban homes, often around 1% for mid-priced homes, with higher percentages in competitive situations.

When is earnest money due after my offer is accepted?

• Most agreements call for delivery within 1 to 3 business days after both parties sign. Your contract sets the exact timeline.

Who holds the earnest money in Hendricks County?

• Usually a title company or a brokerage trust account named in the contract. You should receive a written receipt.

When can I get my earnest money back if I cancel?

• If you terminate within a valid contingency period and follow notice rules in the contract, the deposit is typically refundable.

Can the seller automatically keep my deposit if I back out?

• Not automatically. It depends on the contract and the facts. Some agreements allow liquidated damages; others require a different remedy.

How do I avoid escrow wire fraud on my deposit?

• Confirm wiring instructions by phone with the title company using a known number and never trust last-minute changes sent by email only.