Staring at an offer sheet and wondering how much earnest money to put down for a Portland home? You are not alone. This small but important deposit can make your offer stronger, but it also carries risk if you miss deadlines. In this guide, you will learn how earnest money works in Oregon, typical amounts in the Portland market, the OREF timelines that protect your deposit, and a simple example you can follow. Let’s dive in.
What earnest money is
Earnest money is a good-faith deposit that shows a seller you intend to buy the home. It becomes part of your down payment or closing funds if the sale closes. In Oregon, the deposit terms live inside your signed Residential Purchase Agreement, often the OREF form used across the state.
Your agreement will state how much you are depositing, when it is due, who holds it, and what happens if the sale cancels or a dispute arises. The rules in your contract control when you can get your deposit back.
Typical Portland amounts
There is no fixed amount required by law. In Portland and Multnomah County, you will see a range based on property price and market conditions:
- About $1,000 to $5,000 for less competitive listings or lower-priced homes.
- Around 1% to 3% of the purchase price as a common guideline.
- $5,000 to $20,000 or more in multiple-offer situations where buyers want to signal strong commitment.
Amounts vary with market temperature, seller expectations, competing offers, financing strength, and your own liquidity. Bigger deposits can help you stand out, but they increase risk if you miss a deadline or default.
Who holds the deposit
In most Portland deals, the earnest money goes to the escrow or title company named in your contract. Sometimes a broker trust account holds the funds. You will deliver the deposit by the due date stated in your agreement, often within 1 to 3 business days after mutual acceptance.
Ask for written confirmation when your funds are received. Save the receipt and escrow contact details in your transaction file.
Key OREF deadlines to track
The Oregon Residential Purchase Agreement (OREF) sets timelines that decide if your earnest money is protected. Many blanks are negotiable and must be filled in when you sign. Keep a calendar with reminders ahead of each deadline.
Earnest money due date
Your contract will specify the deposit due date, commonly within 1 to 3 business days after acceptance. If you miss it, you risk a default. Deliver funds early, confirm receipt in writing, and keep records.
Inspection period
You will choose an inspection window, often 7 to 14 business days. During this period, you can inspect, request repairs or credits, or cancel per the inspection clause. If you cancel within the inspection timeline and follow notice rules, your earnest money is usually refundable.
Financing contingency
Your contract will include a financing or loan commitment deadline set by the parties. If you cannot obtain financing and you cancel in writing by the financing deadline, earnest money is typically refundable under the contract. If you miss the deadline, you may remove that protection.
Appraisal timing
If your offer includes an appraisal contingency, a low appraisal may trigger negotiations or allow you to cancel within the contract’s time limits. Be sure to note the appraisal-related dates in your calendar.
Removing contingencies and closing
Once you remove contingencies in writing or let deadlines pass, your deposit generally becomes nonrefundable except in limited cases stated in the agreement. At closing, your earnest money is credited toward the purchase price.
When earnest money is refundable
Your deposit is typically refundable when you:
- Cancel in writing during an active contingency window, such as inspection or financing, following the contract’s notice steps.
- Terminate because the seller cannot meet a material contract requirement, such as delivering marketable title, per your agreement.
- Sign a mutual cancellation with the seller instructing escrow to release funds.
Always send notices before deadlines and in the manner your contract requires.
When your deposit is at risk
Earnest money can become nonrefundable after contingencies are removed or deadlines pass. Common risk points include:
- Missing the inspection objection deadline or withdrawing your inspection contingency, then backing out later for non-covered reasons.
- Failing to cancel by the financing deadline if your loan falls through.
- Defaulting after contingencies are removed.
Read your agreement closely so you know exactly when protections end.
How disputes are handled
Escrow companies usually will not release earnest money without signed instructions from both parties or a court order. If there is a dispute, the OREF agreement can call for mediation, arbitration, or litigation. Escrow may interplead the funds so a court can decide. Keep all deposit receipts, notices, and communications organized in case questions come up.
Example OREF timeline
Below is a simple example using OREF structure and placeholder dates. Always use the actual dates filled in your signed agreement.
- Monday, June 1: Offer accepted, mutual acceptance date.
- By Thursday, June 4: Earnest money due within 3 business days after acceptance. You wire or deliver funds to the named escrow company and receive written confirmation.
- By Thursday, June 11: Inspection period set for 10 days. You either cancel in writing before the deadline for a refund, submit repair requests, or remove the inspection contingency.
- Monday, June 22: Financing contingency deadline set for 21 days after acceptance. If financing cannot be obtained, you cancel in writing by this date to keep your deposit refundable.
- Wednesday, July 15: Closing date. Your earnest money is credited toward the purchase.
Note: OREF allows the parties to choose calendar or business days for certain timelines. Confirm the day-count method in your signed forms and plan reminders with a buffer.
First-time buyer checklist
Use this quick list to stay on track in Portland and Multnomah County:
- Get fully preapproved and verify you have funds for earnest money and closing costs.
- Discuss local norms with your agent for similar homes in your target neighborhoods.
- Decide how much to deposit and which contingencies to include. Understand the risk of nonrefundable options.
- Confirm the earnest money amount and due date in your signed contract.
- Deposit funds early and secure a written receipt from escrow.
- Calendar the inspection, financing, appraisal, and closing dates with reminder buffers.
- If issues arise, follow notice steps exactly and before deadlines to preserve refund rights.
Smart ways to strengthen an offer
A larger or nonrefundable deposit is not the only lever. You can also:
- Offer a reasonable deposit plus a shorter inspection window you can actually meet.
- Be flexible on closing date if it helps the seller’s plans.
- Provide strong preapproval and clear proof of funds for closing costs.
These options can improve your position while keeping your risk in check.
How expert guidance protects your deposit
Construction-informed advice can help you move fast and with confidence during inspections. With a clear read on repair scope and likely costs, you can decide whether to negotiate, proceed, or cancel before deadlines. That reduces surprises and protects your earnest money. If you want this level of support in the Portland metro, I am here to help.
Ready to navigate earnest money and write a strong, safe offer? Reach out to schedule time with me. Visit Josh Halemeier - Main Site to get started.
FAQs
What is earnest money in an Oregon home purchase?
- It is a good-faith deposit written into the purchase agreement that is applied to your price at closing and can be refundable or at risk based on contract deadlines.
How much earnest money do Portland buyers usually put down?
- Common ranges include $1,000 to $5,000, 1% to 3% of the price as a guideline, and $5,000 to $20,000 or more in competitive situations.
Is earnest money refundable if my financing falls through in Oregon?
- Yes, if your contract has a financing contingency and you cancel in writing by the stated deadline following the agreement’s procedures.
Who holds earnest money in Portland transactions?
- Typically the escrow or title company named in the contract, or sometimes a broker trust account, according to the purchase agreement instructions.
What happens to earnest money if I cancel after contingencies are removed?
- Your deposit is generally at risk and may be nonrefundable, unless a contract exception applies or the seller defaults.
How soon must I deposit earnest money after acceptance in Oregon?
- The OREF agreement lets you set the due date, often within 1 to 3 business days after mutual acceptance. Check your signed contract for the exact date.
