Origin Traceable to the Middle Ages, when an earnest payment was called variously an earnest penny, Arles penny, or God's silver, in Latin Argentum Dei, and was money or a token given to bind a bargain such as the purchase or hiring of a servant.
An earnest payment or earnest money, also known as an EMD, is a specific form of security deposit made in some major transactions, such as real estate dealings, or required by some official procurement processes, to demonstrate that the applicant is serious and willing to show an earnest of good faith about wanting to complete the transaction. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/
Facts
Origin PeriodTraceable to the Middle Ages, when an earnest payment was called variously an earnest penny, Arles penny, or God's silver, in Latin Argentum Dei, and was money or a token given to bind a bargain such as the purchase or hiring of a servant. 1 Core PrincipleA specific form of security deposit made in a major transaction, such as a real estate dealing, or required by some official procurement processes, to demonstrate that the applicant is serious and willing to show an earnest of good faith about wanting to complete the transaction. 1 Origin Period
Origin Period (category) Classification
Doctrine Category FAQs
Why does a buyer pay earnest money before a deal closes?
It shows good faith and seriousness about completing the transaction.
An earnest payment is a form of security deposit made in a major transaction such as a real estate deal, or required by some official procurement processes. Its purpose is to demonstrate that the applicant is serious and willing to show an earnest of good faith about completing the transaction. The idea is old: in the Middle Ages the payment was called an earnest penny, an Arles penny, or God's silver, in Latin Argentum Dei.
Connections
Sources
1. Earnest payment (Wikipedia)
History section, medieval earnest penny
the earnest payment was called variously an earnest penny, Arles penny, or God's silver (in Latin Argentum Dei)
Introduction
An earnest payment or earnest money, also known as EMD is a specific form of security deposit made in some major transactions such as real estate dealings or required by some official procurement processes to demonstrate that the applicant is serious and willing to demonstrate an earnest of good faith about wanting to complete the transaction.
In Group: Contract Terms, Privity and Good Faith Doctrines, Introduction, sentence 1
An earnest payment or earnest money, also known as EMD is a specific form of security deposit made in some major transactions such as real estate dealings or required by some official procurement processes to demonstrate that the applicant is serious and willing to demonstrate an earnest of good faith about wanting to complete the transaction.
View the Source2. Wikipedia: Earnest payment
a specific form of security deposit made in some major transactions such as real estate dealings, to demonstrate willingness to complete the transactionView the Source Reader Challenges (0)
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