Once an offer is accepted, the contract itself becomes the thing that actually protects you, or doesn't, depending on whether you understand what's in it. Two of the most misunderstood parts are earnest money and the string of deadlines that come right after you go under contract. Missing either one can cost you money, or the house.
What Earnest Money Actually Is
Earnest money is a deposit you put down shortly after your offer is accepted, showing the seller you're serious. It's not an extra cost on top of your purchase, it gets applied toward your down payment and closing costs at closing. The amount is negotiable and varies by offer, but it's typically a percentage of the purchase price.
The part buyers often misunderstand: whether you get that money back if the deal falls through depends entirely on why it fell through, and whether you were still inside your contingency deadlines when it did.
The Deadlines That Actually Matter
A real estate contract isn't just a purchase price and a closing date. It's a sequence of deadlines, each one tied to a specific contingency that protects you, but only if you act before it expires.
- Attorney review period: a short window, common in Illinois contracts, where either side's attorney can request changes or, in some cases, cancel the contract entirely.
- Inspection deadline: the date by which your inspection needs to happen and any requested repairs or credits need to be submitted.
- Mortgage commitment deadline: the date your lender needs to have your loan fully approved by, not just pre-approved.
- Appraisal deadline: tied to your lender's timeline, this affects whether an appraisal contingency can still protect you if the home appraises low.
Miss one of these without an extension in writing, and you can lose the protection that deadline was there to give you, including, in some cases, your earnest money if the deal later falls apart for a reason that deadline would have covered.
Where Buyers Get Into Trouble
A few patterns show up again and again: assuming a verbal "it's fine, take your time" from the other side counts as an actual extension (it doesn't, get it in writing), losing track of which deadline applies to which contingency, or waiting until the last possible day to schedule an inspection and having no room left if it reveals something that needs a second opinion. None of these are complicated to avoid, they just require paying attention to the calendar as closely as the house itself.
How to Stay on Top of It
The simplest fix is also the most overlooked: as soon as your offer is accepted, write every deadline down somewhere you'll actually look at it, not just in the contract file you won't reopen until something goes wrong. A good agent should also be tracking these with you and flagging anything approaching, not leaving you to catch it alone.
Already Under Contract, or About to Be?
I track every deadline on every contract I write, and I'll make sure you know exactly what's coming up and when, so nothing slips past you by accident.
Get Help Tracking Your ContractFAQ
Is earnest money refundable if I change my mind?
Generally no, not just because you changed your mind. It's refundable when the contract is canceled through a contingency that's still active, like a failed inspection or attorney review raising an issue, within the deadlines that apply.
How much earnest money is normal?
It varies by offer and local custom rather than a fixed rule. Your agent can tell you what's typical for the price range and competitiveness of the home you're offering on.
What happens if my lender needs more time than the mortgage deadline allows?
Ask for a written extension before the deadline passes, not after. Most sellers will grant a reasonable one, especially if there's a clear reason, but it has to be documented, not assumed.
Who actually holds the earnest money?
Typically a title company, attorney, or brokerage holds it in escrow, not either party directly. It gets applied or returned according to how the contract resolves.