Earnest money receipts are quite important when a buyer is purchasing a real estate property. Sellers or real estate brokers provide this receipt as a proof of the money the buyer has provided as a downpayment.
In order to create an earnest money receipt, you can download the earnest money receipt template from CocoSign. It is available for free of cost and all you have to do is print it out and enter your details. In order to learn more about earnest money receipt, keep reading below:
What Is an Earnest Money Receipt?
An earnest money deposit receipt is a legal document that proves that the buyer of a real estate property has paid the earnest money (also called consideration) for the property.
This receipt is given to the buyer when the buyer and seller create a real estate purchase agreement. During the creation of the agreement, the buyer has to give a certain amount of money to show their seriousness to buy the property.
This money is known as earnest money and it is needed so that the seller feels safe that the buyer is really interested in buying the property.
When Needs an Earnest Money Receipt and Why?
Most sellers or realtors do not start property negotiations once the buyer shows that they are willing and serious to buy the property. Once the buyer has provided a small deposit (known as the earnest money), the seller or realtor will feel that the buyer is serious about buying it.
This earnest money also acts as a security for the property purchase agreement. In case the seller is not able to fulfil the sale of the property, he is to return the earnest money to the buyer along with damages.
However, in case the buyer does not go ahead with purchasing the property, the earnest money is generally returned to the buyer.
What Are the Elements in the Earnest Money Receipt?
The elements of an earnest money receipt include:
Date: The earnest money slip starts with the date on which the slip is issued.
Earnest Money Holder: Earnest money holder is the party who is receiving the earnest money. The receipt should include their full name as they agree that they have received the earnest money.
Dollar Amount: The receipt should then state the dollar amount that is received as earnest money. It should also mention the form in which the payment is received, be it credit card, cheque, or any other.
Property Details: Next, it is important to mention the details of the property that is being sold by the seller. The details include the complete address of the property.
Buyer and Seller Details: The receipt should also mention the names of the buyer and the seller, along with the mailing address for each of these.
Signature: Lastly, the earnest money receipt should be signed by the person who is holding the earnest money. The signature should be followed by the name of the person.
Endnotes
Creating an earnest money receipt is not difficult. The only thing required for this purpose is to download the earnest money template, which is available at CocoSign for free.
CocoSign also provides many other agreement, receipt, and form templates. Feel free to browse through CocoSign’s library to download any document that you require. These templates are legally created to hold valid as a proof in court.