You are about to make an offer on a Dover home, and the seller is asking for earnest money. How much should you put down, and when do you get it back if things change? It can feel like a lot to navigate on top of inspections, appraisals, and timelines.
You deserve clear answers before you wire a dollar. In this guide, you will learn what earnest money is in New Hampshire, how it works in Dover, when it is refundable, how it can strengthen your offer, and the pitfalls to avoid. You will also see a simple Dover timeline so you know what to expect. Let’s dive in.
Earnest money basics in NH
Earnest money, sometimes called a good-faith deposit, is a cash deposit you provide after your offer is accepted. It signals to the seller that you are serious and helps them feel confident taking the home off the market. If you close, the deposit is applied to your purchase price, down payment, or closing costs. If you do not close, refund rules depend on your contract.
In New Hampshire, your Purchase and Sale Agreement should name the escrow holder and where funds are kept. Depending on the deal, the deposit is often held by the listing brokerage, a title company or closing agent, a buyer’s or seller’s attorney, or another designated escrow account. Always confirm the holder in writing and get a receipt.
Who holds your deposit
New Hampshire and the broader New England region often involve attorneys in closings, so an attorney trust account is common. Title companies and brokerage escrow accounts are also used. There is no single statewide rule for who holds the money. The contract controls the details.
What matters most is clarity. Make sure the agreement states who holds the funds, when they must be delivered, and the instructions for disbursement if there is a dispute. Save the written receipt showing the date, amount, and account.
Typical Dover amounts
For many New Hampshire purchases, earnest money often ranges from 1,000 dollars to about 3 percent of the purchase price. In competitive situations or at higher price points, deposits of 3 to 5 percent or more can be used. For lower-priced condos or some new construction, a fixed amount such as 500 to 2,500 dollars may be typical.
Your amount will depend on:
- Local competitiveness in the Dover and Strafford County market.
- Price point and common percentage norms for that range.
- Your financing type and strength of your contingencies.
- Seller expectations and listing agent guidance.
Dover is part of the Seacoast and Strafford County market, and competitiveness varies by neighborhood, season, and price tier. Ask your local agent to confirm current custom for your specific property and price band.
Refund rules and contingencies
Whether your earnest money is refundable depends on your Purchase and Sale Agreement. Common buyer protections include the following, but always check your contract:
- Home inspection contingency. If you and the seller cannot reach agreement on repairs or credits within the inspection window, you may cancel and receive the deposit back.
- Financing contingency. If your lender denies the loan despite good-faith efforts within the stated timeframe and you provide proper notice, the deposit is typically refundable.
- Appraisal contingency. If the home does not appraise at the contract price and you cannot renegotiate, you can often exit under this contingency.
- Title contingency. If title defects cannot be cured by closing, you may be entitled to a refund.
- Sale-of-home contingency. Less common in competitive markets, but when included it must be satisfied or waived per the contract.
Typical timeframes vary by deal. Inspection windows are often 5 to 14 days from acceptance. Financing is commonly 21 to 45 days, and appraisals track the lender process. The key is to meet deadlines and follow the notice procedures precisely. If you miss a deadline or terminate incorrectly, you could risk the deposit.
When a seller may keep it
A seller may be allowed to keep your earnest money if you breach the contract and do not have a valid contingency to protect you. This can include failing to close without an allowed reason or missing required notice steps. Disputes may go to mediation, arbitration, or court depending on your contract, and escrow holders usually need joint written instructions or a court order to release funds when parties disagree.
How it strengthens your offer
A strong earnest money deposit can help your offer stand out, especially when multiple buyers are competing. Here is how it helps:
- Buyer credibility. A larger or faster deposit signals commitment and capacity.
- Negotiation leverage. When two offers are similar, sellers often favor the one with stronger deposit terms.
- Contingency balance. If you shorten or waive certain contingencies, a higher deposit may help offset perceived risk to the seller. Be sure you understand the added risk to you.
- Speed and clarity. Deposit your funds within the stated timeframe and get written confirmation. Certainty builds trust.
Pair your deposit with non-monetary strengths, such as a true lender pre-approval, a realistic closing timeline, flexibility on possession, and clear contract language.
Dover timeline example
Below is a simple example for a financed single-family purchase in Dover. Your actual dates will be set by your contract and lender.
- Day 0: Offer accepted. You and the seller sign the Purchase and Sale Agreement. Earnest money is 3,000 dollars and must be deposited within 48 hours to the named escrow holder.
- Days 0 to 2: Deposit delivered. You wire or hand-deliver 3,000 dollars and obtain a written receipt. Save it to your file.
- Days 1 to 10: Inspection period. You complete the home inspection, negotiate repairs or credits, or cancel within the window if needed.
- Days 0 to 30: Financing window. You submit a full loan application at once. The lender orders the appraisal. If financing is denied, you follow the contract notice process to request a refund.
- Days 15 to 30: Appraisal and title review. If the appraisal is below the price, you renegotiate, bring funds, or cancel per contingency terms. Title is reviewed and any defects are addressed.
- Days 30 to 45: Closing. You sign loan documents and close. Your earnest money is credited toward your cash to close.
If you cancel properly within a contingency and follow notice rules, you should receive your deposit back. If you breach the agreement without an allowed contingency, the seller may seek to keep the deposit as set out in the contract.
Pitfalls and safeguards
Common pitfalls:
- Not reading or understanding the contingency language and deadlines.
- Missing the deposit deadline. Late delivery can be a breach.
- Relying on verbal promises. Only the written contract controls.
- Sending money to the wrong place or skipping a written receipt.
- Waiving key contingencies without understanding the risk of losing your deposit.
- Failing to document your efforts, such as a lender denial letter for a financing contingency.
- Assuming state law automatically protects your deposit. Protection is primarily contractual.
Practical safeguards:
- Get escrow instructions in writing and a receipt showing date, amount, and account.
- Set clear, achievable contingency timelines. Ask your agent to confirm what is customary in Dover.
- Keep copies of all notices and reports, including inspection summaries and lender letters.
- Use standard contract forms and clear contingency language. Have an attorney review if you are unsure.
- For large wires, confirm instructions verbally using a known phone number to avoid fraud.
Quick pre-deposit checklist
Before you send funds, confirm these items:
- The exact escrow holder name, address, and account type.
- The delivery method and deadline for the deposit.
- All contingency deadlines, notice requirements, and how to deliver notices.
- Whether the deposit scales up with milestones, such as an additional deposit after inspections.
- How disputes are resolved and who authorizes disbursement.
Get local guidance
Earnest money is a small part of your total purchase, but it carries real weight. The right amount and clean execution can help you win the home while protecting your interests. A Dover-area expert can help you tailor your deposit, timelines, and contingencies to current market conditions.
If you are planning a move in Dover or the Greater Seacoast, our team at Nola & Associates is here to help you structure a smart, competitive offer from the first conversation through closing.
FAQs
How much earnest money do Dover buyers usually put down?
- Many New Hampshire buyers offer between 1,000 dollars and about 3 percent of the price, with 3 to 5 percent more common in competitive or higher-priced situations. Your amount should reflect local competition and your price tier.
Is earnest money refundable in New Hampshire?
- Refunds depend on your contract. If you terminate within a valid contingency period and follow notice rules, your deposit is typically returned. If you breach without protection, the seller may be allowed to keep it.
Who holds earnest money for Dover purchases?
- The Purchase and Sale Agreement controls it. In NH, deposits are often held by a listing brokerage, a title company, or an attorney’s trust account. Always get the escrow holder and receipt in writing.
What happens if my loan is denied after I deposit funds?
- If you have a financing contingency and act in good faith, provide required documentation, and give proper notice within the deadline, your deposit is typically refundable per the contract.
Can I use earnest money toward closing costs?
- Yes. If you close, your earnest money is credited to your purchase price, down payment, or closing costs as stated in the closing documents.
How fast do I need to deposit earnest money in Dover?
- Many contracts require initial delivery within 24 to 72 hours of acceptance. Your exact deadline will be stated in your agreement, so plan ahead and confirm wiring details early.
