Earnest money is the deposit a buyer puts down when an offer is accepted. It shows the seller you’re serious, and in Wisconsin the WB-11 offer form spells out exactly how it’s handled.
How much should you offer?
There’s no required amount. The figure is negotiated as part of your offer and depends on the price of the home and how competitive the situation is. A larger deposit can make an offer stronger, but it also means more money at risk if you default without a contingency to protect you.
Who holds it?
Earnest money is usually held in a real estate broker’s trust account, most often the listing broker’s, unless the offer says otherwise. Wisconsin regulates how brokers handle trust funds, so the money can’t simply be released to one side on request.
What happens at closing?
If the sale closes, your earnest money is credited toward your down payment and closing costs. You don’t lose it; it becomes part of what you’ve already paid.
What if the deal falls apart?
- If a contingency in your offer isn’t satisfied, such as financing or inspection, and you follow the offer’s deadlines and notice requirements, the earnest money is generally returned.
- If a buyer simply walks away without a contingency to rely on, the seller may have a claim to it.
- When the parties disagree, the broker holding the funds must follow the rules for disputed earnest money rather than choosing a side.
Contingency deadlines matter. Missing one can turn a refundable deposit into money at risk, which is why it pays to understand how the inspection contingency works before you write.
The bottom line
Earnest money is routine, and in most transactions it simply moves to the closing table. Your agent should explain the amount, the deadlines and your protections before you sign anything. See our step-by-step buying guide or learn how we represent buyers.