Buying your first home in Jackson County is exciting, and a little bit nerve‑racking. One of the first decisions you will make after your offer is accepted is how to handle earnest money. If you are unsure what it is, how much to offer, or how to protect it, you are not alone. In this guide, you will learn the essentials for Medford, Central Point, and nearby Rogue Valley towns so you can move forward with confidence. Let’s dive in.
Earnest money basics
Earnest money is a deposit you put down after a seller accepts your offer. It shows you are serious, and it is usually credited to your down payment and closing costs at closing.
The deposit motivates a seller to take the home off the market during escrow. It also gives the seller a limited remedy if a buyer breaches the contract, depending on the contract language. Most Oregon purchase agreements spell out exactly when the deposit is refundable and when it is not.
In a typical timeline, your offer is accepted and you deliver the deposit within the deadline in your contract. Many Jackson County offers call for delivery within 24 to 72 hours. At closing, your earnest money is applied to your cash to close.
Typical amounts in Jackson County
In many markets, a common range is 1 to 3 percent of the purchase price. You can use that as a starting point here in Jackson County, then adjust for price point and how competitive the property is.
- On a $350,000 home, 1 percent equals $3,500.
- On a $450,000 home, 1 percent equals $4,500.
- For lower‑priced homes, sellers sometimes accept a flat amount, such as $1,000 to $3,000.
In a hot, multiple‑offer situation, you might strengthen your offer with a larger deposit or tighter timelines. In a slower market, you may offer less. Treat these figures as examples and align your amount with current Medford and Central Point norms.
How deposits are handled in Oregon
Who holds the money
Most buyers deposit earnest money with a title or escrow company in a regulated escrow or trust account until closing. The American Land Title Association explains how escrow works during a home purchase.
In some cases, a real estate brokerage trust account can hold the deposit. In Oregon, licensees must follow strict rules for client funds. You can review the Oregon Real Estate Agency’s site for licensing and trust account oversight.
When and how to pay
Your contract will set the delivery deadline. Plan to wire funds or deliver a cashier’s check to the named escrow holder within that window. Always confirm wiring instructions by phone using a known, trusted number to avoid fraud.
Ask for a written receipt from escrow or the brokerage and keep it with your records. You should also see your deposit listed on the escrow instructions and, later, on your closing disclosure.
Contingencies that protect you
Contingencies are safety valves that let you cancel and recover your deposit if certain things happen and you follow the notice rules in your contract.
- Inspection contingency. You can negotiate repairs or cancel within the stated timeline if the inspection uncovers issues. Act before the deadline.
- Financing (loan) contingency. If your lender denies the loan despite your good‑faith effort and you provide notice on time, your deposit is often refundable.
- Appraisal contingency. If the appraisal comes in low and you do not waive this protection, you may cancel and recover your deposit.
- Title or sale‑of‑home contingencies. These also include clear timelines and notice requirements.
The details matter. Follow the form’s steps and deadlines to keep protections in place.
Ways buyers lose deposits
Missed deadlines
If you miss a contingency deadline and try to cancel later, the seller may have a claim to the deposit. Calendar the key dates and give written notice the way your contract requires.
Removing protections early
If you remove contingencies and then change your mind, your deposit is at risk. Avoid waiving protections unless you are fully comfortable with the risk.
Liquidated damages in Oregon
Many Oregon purchase agreements include a liquidated damages option that lets the seller keep the earnest money if the buyer defaults. This is often the seller’s exclusive remedy if selected. If that clause is not chosen, a seller could pursue other remedies.
To understand how this works, review the Oregon REALTORS standard forms and guidance with your agent before you sign.
If a dispute arises
Steps to take
- Re‑read your signed purchase agreement to confirm deadlines, contingency language, and notice rules.
- Provide written notice exactly as the contract requires.
- Ask escrow to hold funds until both sides agree or a decision is reached.
- Use the dispute resolution method in the contract, such as mediation or arbitration.
Escrow and title companies follow state regulations and will not release funds without proper instructions. The Oregon Division of Financial Regulation provides oversight for financial services in the state. Learn more about consumer protections and oversight.
When to get help
If you believe you canceled under a valid contingency and the seller still refuses to release the deposit, loop in your real estate agent and consider an attorney’s review.
Buyer checklist for Jackson County
Use this quick list before you write an offer.
- Set a strategic deposit amount. Start with 1 to 3 percent and adjust to the home’s price and the market’s speed.
- Choose where funds go. Prefer a licensed title or escrow company named in the offer, or a brokerage trust account, and get a receipt.
- Track every deadline. Inspection, appraisal, and loan dates are critical. Put them on your calendar.
- Keep your protections. Do not remove contingencies early without a clear plan.
- Watch the liquidated damages box. Know whether it is selected and what that means for your risk.
- Document everything. Save inspection reports, lender letters, appraisal reports, and all notices.
- Confirm escrow details. Verify the escrow company’s name, your file number, and your escrow officer’s contact info.
Local insight and timing
Norms vary by neighborhood and price point in Medford, Central Point, Ashland, and nearby towns. Some sellers prefer a minimum flat amount. Others expect a percentage. Local escrow companies, such as Western Title & Escrow’s Medford office, can guide you on delivery options and receipt timing once your offer is accepted.
If you want help matching your deposit strategy to current conditions, work with a local agent who tracks multiple‑offer trends and typical seller expectations in the Rogue Valley.
Ready to talk strategy for your next offer in Jackson County? Connect with Matt Misener to set your deposit amount, map your deadlines, and protect your earnest money from offer to close.
FAQs
What is earnest money in Oregon real estate?
- It is a good‑faith deposit you provide after your offer is accepted. It is held in escrow or a brokerage trust account and is credited to your costs at closing.
How much earnest money should a Medford first‑time buyer offer?
- A common starting point is 1 to 3 percent of the price, adjusted for competition and price point. Flat amounts like $1,000 to $3,000 are sometimes used on lower‑priced homes.
Who holds earnest money and is it safe?
- Title and escrow companies or brokerage trust accounts typically hold the funds under state rules. See ALTA’s overview of how escrow works and the Oregon Real Estate Agency’s oversight information.
When can I get my deposit back after an inspection?
- If your contract includes an inspection contingency and you cancel within the deadline using proper notice, your deposit is often refundable.
What does “liquidated damages” mean in Oregon purchase contracts?
- It usually means the seller keeps the earnest money if the buyer defaults and that is the seller’s agreed remedy. Review the Oregon REALTORS forms guidance with your agent before you sign.
