HUD Home Earnest Money Requirements

Earnest money must be certified funds and must be delivered to the Listing Broker within 2 business days of the buyer’s bid being acknowledged as the winning offer by HUD. It should accompany a signed copy of the HUD-9548 Contract of Sale and the filled out Buyer Select Closing Agent (BSCA) addendum. 

Earnest Money check should be made payable to Buyer Select Closing Agent (BSCA).

The following table lays out the amount of Earnest Money required by transaction type:

Transaction Type Earnest Money Required
Sales Price: $50,000 or LESS $500
Sales Price: $50,001 or MORE $1000
Vacant Lots 50% of the Sales Price
Good Neighbor Next Door (GNND) 1% of Sales Price (minimum $500, maximum $2000)
HUD Approved Non-Profits  No Earnest Money is Required

One very important aspect of earnest money in regards to HUD homes is that unlike regular transactions the seller in most cases WILL NOT return any portion of earnest money should the buyer choose to not move forward with the purchase even after the findings of a home inspection.

Be sure to communicate this to your buyers before they submit any Earnest Money should their offer be accepted.