Making an offer on a Wilmette home and wondering how much earnest money you need? You are not alone. On the North Shore, this good-faith deposit plays a big role in how strong your offer looks and how protected your money is throughout the contract. In this guide, you will learn what earnest money is, typical amounts in our market, when and how it is paid, and the contingencies that keep your deposit safe. Let’s dive in.

What earnest money is and how it works

Earnest money is a buyer’s deposit that shows you are serious about purchasing a home. The funds are held in escrow and applied to your cash to close at settlement. If the transaction does not proceed for a reason covered by your contract, the deposit is typically returned.

On the North Shore, earnest money is standard in nearly all offers. The exact amount, who holds it, and how it can be released are set by the purchase contract you and the seller sign.

Typical amounts on the North Shore

A common rule of thumb in many markets is 1 to 3 percent of the purchase price. In Wilmette and nearby suburbs, buyers often offer a fixed dollar amount in the range of about 5,000 to 25,000 dollars, or roughly 1 to 2 percent of the price. Higher-priced listings, such as 800,000 to 1 million dollars and above, frequently involve larger deposits in dollar terms.

Competition influences this decision. In multiple-offer situations, some buyers increase their earnest money to signal strength. You should balance a competitive amount with the protections in your contract so your deposit is not at unnecessary risk.

When you pay it and how it is handled

Your contract will state when the deposit is due. On the North Shore, it is commonly due within 24 to 72 hours of offer acceptance, or at the time of signing. You will typically provide the funds by check, cashier’s check, or wire transfer. Some sellers or brokers may require certified funds before deposit.

Once received, the escrow holder deposits the funds into a trust account and maintains records according to Illinois rules. The deposit stays there until closing or until it is released under the contract.

Who holds earnest money in Illinois

Several parties can hold escrow in our area. The most common are:

• The listing broker’s trust account
• The buyer’s broker’s trust account
• A seller’s or buyer’s attorney in an IOLTA client trust account
• A title or escrow company, which is more common at closing

Confirm in writing who will hold the funds and where they will be deposited. Ask for a written receipt and keep a copy with your contract records. To reduce wire-fraud risk, never rely on emailed wiring instructions without calling a known phone number to verify details first.

Contingencies that protect your deposit

Your contract’s contingencies are your primary protections. When you follow the terms and deadlines, these contingencies typically allow you to cancel and recover your earnest money.

Attorney review in Illinois

Residential contracts here commonly include an attorney-review or attorney-approval period. During that short window set by the contract, attorneys can propose changes or either party can terminate per the agreement. If a proper termination occurs during this period, the earnest money is typically returned under the contract terms.

Inspection contingency

An inspection contingency gives you time to complete a home inspection and either request repairs, negotiate credits, or cancel within the deadline. If you cancel according to the contingency and notice rules, your deposit is usually returned.

Financing and appraisal contingencies

A financing contingency protects you if you cannot obtain your mortgage by the stated deadline, provided you deliver notice as the contract requires. An appraisal contingency helps if the appraisal comes in below the purchase price, allowing you to renegotiate or cancel based on the contract language.

Title and other provisions

A title contingency allows termination if title defects are not resolved. Some buyers also include a sale-of-buyer’s-home contingency, though this is less common in competitive settings on the North Shore.

When you get it back vs. when it is at risk

Here are typical outcomes buyers ask about:

• You cancel during inspection within the deadline and follow notice instructions. Earnest money is returned.
• The appraisal is low and you properly invoke the applicable contingency. Earnest money is returned.
• You cannot secure financing and have an active financing contingency with proper notice. Earnest money is returned.
• You miss a contingency deadline and later decide to back out without a contractual basis. Earnest money may be forfeited under a liquidated damages clause if included in the contract.
• The seller defaults or refuses to close. Earnest money is returned, and you may have additional remedies per the contract.
• Both parties sign a mutual cancellation. The deposit is released as agreed, often back to the buyer.

Contracts in Illinois often include a liquidated damages clause that allows a seller to keep the deposit if the buyer defaults after contingencies expire. The exact outcome depends on your specific contract, so it is important to meet deadlines and follow notice procedures closely.

How to make a strong and safe offer in Wilmette

In a competitive North Shore market, the goal is to look serious while staying protected. Consider these best practices:

• Set a confident but comfortable deposit amount. Use a fixed amount or 1 to 2 percent of price based on guidance from your local agent and the competition level.
• Keep contingency timelines realistic. Allow enough time for inspection, appraisal, and loan approval.
• Know your notice requirements. Deliver all notices in writing and follow the contract’s delivery method.
• Clarify who holds escrow. Confirm holder, deposit timing, and get a receipt.
• Be cautious about waiving protections. Waiving inspection or financing can strengthen your offer but increases risk to your deposit.
• Guard against wire fraud. Verify instructions by phone using a known number, not just an email.

A simple timeline for a North Shore offer

• Offer accepted. Attorney-review clock starts if included in the contract.
• Within 24 to 72 hours. You deliver earnest money as the contract specifies.
• Inspection period. You complete inspections and negotiate repairs or credits, or cancel within the deadline if needed.
• Appraisal and financing period. Your lender orders the appraisal and processes your loan. If issues arise, you follow the contract’s remedies and notice rules.
• Title review. Title is examined, and any issues are cleared before closing.
• Closing. Your earnest money is applied to your cash to close.

Common mistakes to avoid

• Offering a large deposit without considering contingency protections. Match your earnest money to your comfort level and contract terms.
• Missing deadlines. Late notices can remove your right to recover the deposit.
• Skipping written confirmations. Keep a paper trail for deposit receipts and notices.
• Following emailed wire instructions without verification. Always call using a known phone number to confirm details.
• Assuming the contract is standard. Terms vary by form and negotiation, so review with a local agent and attorney.

The North Shore advantage with local guidance

Earnest money is a small part of your total purchase, but it carries outsized importance in our competitive North Shore market. The right amount, clear escrow instructions, and solid contingency management can help you win the home and keep your deposit protected.

If you are getting ready to make an offer in Wilmette or a nearby suburb, our team can help you set the right strategy and manage each step with confidence. For personal guidance from a neighborhood-rooted team, reach out to Julie Bird. We will help you craft a strong offer and protect your interests from offer through closing.

FAQs

How much earnest money should I offer on a Wilmette home?

• Many North Shore offers use 5,000 to 25,000 dollars or about 1 to 2 percent of the price, with higher-priced homes often seeing larger deposits. Your final number should reflect price and competition.

When is my earnest money due in Illinois?

• Most contracts require delivery within 24 to 72 hours of acceptance or at signing. Your contract will specify the exact timing.

Who typically holds the deposit in our area?

• The listing or buyer broker’s trust account, an attorney’s IOLTA trust account, or sometimes a title or escrow company. Confirm in writing and get a receipt.

Can I get my deposit back if I change my mind?

• If you cancel within a valid contingency and meet all notice and deadline requirements, the deposit is typically returned. Canceling without a contractual basis risks forfeiture.

What happens if the appraisal comes in low?

• If your contract includes an appraisal or financing contingency and you act before the deadline, you can renegotiate or cancel and recover your deposit per the agreement.

What if I cannot get my mortgage on time?

• With a financing contingency in place and proper notice, you can usually terminate and receive your deposit back. Deadlines and documentation matter.

How are earnest money disputes resolved in Illinois?

• Your contract controls the process, which can include negotiation, mediation, arbitration, or court. Keep thorough records and follow notice instructions exactly.