Earnest money is a deposit paid—often into an escrow account—to show a good-faith intention to complete a transaction—often a transaction for the purchase of real property (real estate).

If the prospective buyer defaults and fails to complete the transaction for the purchase of the real property (fails to close) the earnest money is usually forfeited and delivered to the would-be seller under the terms of the contract or agreement for the sale of the property.

Earnest money is generally not required for a valid contract for the purchase and sale of real property, but is often included to compensate the prospective seller for time and potential missed sales opportunities while the sale was “under contract” with the prospective buyer.

Earnest money may also be referred to as earnest; bargain money; caution money; hand money; or down payment.

In Nevada, earnest money is a deposit made by a prospective buyer to demonstrate their serious intent to purchase real estate. This deposit is typically held in an escrow account during the transaction process. If the buyer fails to complete the purchase (fails to close), the earnest money is usually forfeited to the seller, as per the terms outlined in the purchase agreement. While earnest money is not a legal requirement for a real estate contract to be valid in Nevada, it is a common practice to provide assurance to the seller. The amount of earnest money and the conditions under which it may be forfeited or returned are typically specified in the purchase agreement. It's important for both buyers and sellers to clearly understand the terms related to earnest money in their contract, and they may wish to consult with an attorney to ensure their rights and interests are adequately protected.