[WSBARP] limit on Earnest Money.

[tjw at w3net.net]

What Criag said!:)

 

Regards, Tom

 

Thomas J. Westbrook 

Attorney at Law

Of Counsel

Budd Bay Law, P.S.

324 West Bay Dr. NW

Suite 201

Olympia, WA 98502

360-866-400

 

 

 

 

 

 

 

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Craig Blackmon
Sent: Tuesday, October 28, 2025 8:03 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] limit on Earnest Money.

 

Craig, the parties can agree to earnest money in excess of 5%.  They simply need to include language sufficient to support the liquidated damages provision, as set forth in case law. I generally use something like:

 

"If Buyer were to breach this Agreement, Seller’s losses would be difficult or impossible to ascertain. The earnest money constitutes “liquidated damages” and is a reasonable estimate of Seller’s losses if Buyer breaches this Agreement. As Seller’s only remedy upon Buyer’s breach, Buyer will forfeit the Earnest Money, including that portion in excess of 5% of the Purchase Price."

 

If anyone has experience in handling an EM dispute of >5%, and whether forfeiture was enforceable, please share!

 

Craig

Craig Blackmon, Attorney at Law <https://www.mywsba.org/PersonifyEbusiness/LegalDirectory/LegalProfile.aspx?Usr_ID=000000029240> 

92 Lenora St. #13, Seattle WA  98121 

Office/Cell: (206) 369-5949   

On the blog: Changes to Title and the QCD <https://seattlepropertylawyer.com/blog/quitclaim-deed-explained> 

 <https://seattlepropertylawyer.com/>     <https://www.fsbolawyers.org/> 

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On Mon, Oct 27, 2025 at 8:14 PM Tom Westbrook <tjw at w3net.net <mailto:tjw at w3net.net> > wrote:

Hey Craig, totally spit balling here, but can’t you have a separate earnest money agreement referenced in the P&SA that provides how the parties agree to handle the earnest money irregardless of statutory or case law, etc?

Best Regards, Tom Westbrook 

 

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From: wsbarp-bounces at lists.wsbarppt.com <mailto:wsbarp-bounces at lists.wsbarppt.com>  <wsbarp-bounces at lists.wsbarppt.com <mailto:wsbarp-bounces at lists.wsbarppt.com> > on behalf of Craig Gourley <craig at glgmail.com <mailto:craig at glgmail.com> >
Sent: Monday, October 27, 2025 5:34:55 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com <mailto:wsbarp at lists.wsbarppt.com> >
Subject: [WSBARP] limit on Earnest Money. 

 

Listmates,   I understand the Earnest Money limitations contained in RCW 64. 04.005 and that earnest money outside of the 5% is controlled by case law.  I have a very large developer that is offering my client substantially more than the 5% as Earnest money and they have offered to waive the statutory limit.  Typically I would just restructure it as an partially an option payment but the developer is pushing back.  I thought I would consult the collective before diving into case law.    Any thoughts?  Thanks!

 

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