In a real estate transaction, once a contract is ratified—meaning both buyer and seller have agreed to all terms in writing—it becomes legally binding. At that point, most people assume the deal is locked in unless the buyer invokes one of their contingencies. But there is one critical, often overlooked moment when the seller may still have an “out”: if the buyer fails to deliver the Earnest Money Deposit (EMD) by the deadline.
By Lynn Norusis
July 2025
The EMD is a good faith deposit submitted by the buyer to show serious intent to move forward with the purchase. The contract specifies how much is due and by when—typically within 3 to 5 days after ratification. This money is usually held by the title company, escrow agent, or the buyer’s brokerage until settlement. But here’s the key: if the buyer does not deliver the EMD by the stated deadline, they are in breach of contract.
This breach gives the seller a unique and time-sensitive opportunity to void the agreement. According to most standard regional contracts—like the ones used in Northern Virginia—if the buyer misses the EMD deadline, the seller has the right to deliver a Notice to Void. This must be done before the deposit is made. Once the money hits the escrow account, the seller loses that option.
It’s important to understand that this is the only seller-initiated way to void a ratified contract without having to prove default through a lengthy legal process. It’s clean, clear, and enforceable—but only if handled promptly and correctly.
For sellers and their agents, this means keeping a close eye on the EMD timeline. If the deadline passes and no confirmation of deposit is received, the seller must act fast. Consult with your agent or attorney, issue the appropriate notice, and confirm the deposit has not yet been made. Timing is everything.
For buyers, this is a reminder to treat the EMD deadline with the same urgency as any other contract obligation. A simple oversight or delay can cost you the home entirely.
In a fast-moving market, understanding this nuance gives both parties clarity—and in some cases, leverage. The earnest money deposit may seem routine, but it can carry major weight if things start to unravel.
