Market Wise Q&A column: Who Should Receive Our Earnest Money Deposit Check?


Pat Kapowich for the San Jose Mercury News Q:  We have been looking for a home for several months.  Whenever we write an offer our Buyer’s Agent has us include an earnest money deposit check made out to his brokerage’s trust account.  We felt uncomfortable with this option and he said we could write a deposit check and leave the first half of the  “payable to” section partially blank, for instance, (blank) Escrow Company.   This alternative does not seem any better than the first option.  Is there a safer method for buyers to make an earnest money deposit?

A: Sure.  Last year a prominent real estate attorney told a group of agents in a risk-management course that I was attending, that wire transfers are the safest method of handling buyers’ deposits for the real estate community.  Clearly, this also happens to be the best method for buyers as well.  The buyer indicates that their deposit will follow an accepted offer.  If the buyer’s offer is never ratified, the deposit is moot.   Mishandling earnest money deposits, deliberately or accidentally has always been one of the top ways for brokerages to be fined and/or disciplined or worse; shut down temporarily or permanently.



Realtor Pat Kapowich, Kapowich Real Estate, is a Certified Residential Broker and instructs quarterly in real estate at De Anza College.  Contact him at (408) 245-7700 or

Realtor Pat Kapowich. Broker/Owner Certified Residential Broker