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Do you have to be licensed to receipt earnest money in Texas?

Selling a home is a large financial transaction. In order to make sure buyers are serious in their offer, they include earnest money. Earnest money is usually 1-5% of the value of the property depending on the area. If the transaction is successfully completed and the process continues, the earnest money will usually go towards the down payment of the house.

Do you have to have a license in order to receipt earnest money? The short answer is noㅡthe earnest money receipt can be signed by anyone from the title company in Texas. However, to learn more about earnest money deposit receipts, read on. In this article, we cover everything you need to know about earnest money deposit receipts.

How to Receipt Earnest Money

The earnest money deposit receipt should be given to the buyer of the real estate after they entered into the contract with the seller. A deposit slip is given to the buyer after they have given the earnest money to the third party to acknowledge the money has been received. After the deposit slip is signed, the two parties are officially in an agreement.

The deposit receipt can be downloaded from a template online. The third party (which is typically either the title or escrow company) should give the buyer the deposit slip after they wire the money directly into their bank account. The deposit slip is then given to the seller as proof that this transaction occurred.

What Does an EMD Receipt Typically Include?

The earnest money receipt typically includes the following information:

  • Name of the Title Company
  • Address of the Title Company
  • Name of the Title Company’s Bank
  • The Title Company’s Bank Account Number
  • The Receipt Number
  • The Escrow Number
  • The Property Address
  • Date of Deposit
  • Name of the Person who Received the Receipt
  • Amount of the Deposit
  • Name(s) of the Payor, Usually the Buyer
  • Copy of the Original Check


The receipt also typically includes a refund policy section. This outlines the instances where the seller gets to keep the earnest money, and the instances where the buyer gets the earnest money refunded.

The buyer usually gets refunded in cases such as the house didn’t appraise for the sales price or a serious defect was discovered during the inspection. However, these examples must be listed under the contingencies in the contract for the buyer to get a refund.

The seller gets to keep the earnest money if the buyer decides to back out of the contract because of contingencies that were not listed in the contract or because they decide to not buy the house from a change of heart.

How Does an EM Deposit Work?

As stated previously, earnest money is put down before the closing of a house to show the seriousness of the offer to the seller. It’s a way to protect the seller in case the buyer decides to back out of the deal.

The earnest money deposit is held by the third party (the title or escrow company), and a deposit slip is given to the seller as acknowledgement of the transaction. In Texas, if the amount of earnest money is $1500 or less, the title company can accept a personal check. However, if the earnest money is $1501, the title company is required to only accept certified funds such as a cashier’s check or wire transfer. This is a rule from the Texas Department of Insurance.

It is extremely important to note that within the last few years, the rules surrounding the deliverance of the earnest money deposit have changed in Texas. Previously, the Texas Real Estate Commission (TREC) had no specific deadline for the delivery of the earnest money. However, these are the words stated on TREC contracts now:

“Within 3 days after the Effective Date, Buyer must deliver $_____ earnest money to _____, as escrow agent, at ______.” 

The new rules also cover the consequences of not delivering the earnest money on time:

“If Buyer fails to deliver the earnest money in the time required, Seller may terminate this contract or exercise Seller’s remedies under Paragraph 15, or both, by providing notice to Buyer before Buyer delivers the earnest money. If the last day to deliver earnest money falls on a Saturday, Sunday, or legal holiday, the time to deliver the earnest money is extended until the end of the next day that is not a Saturday, Sunday, or legal holiday. Time is of the essence for this paragraph.”

After the money is delivered into the title or escrow company’s bank account, the deposit receipt is filled out, signed, and given to the seller as proof that the transaction occurred between the parties.

Do You Have to Be Licensed?

Frank Gray, the owner of Abby Realty in Houston, says this about the signature on the earnest money deposit: “The EM receipt can be signed by anyone authorized by the title company, no license required.”

However, it is important that the earnest money deposit receipt should be drafted between the buyer, the seller, and a reputable third party. The receipt acts as a contract between the two parties, so it should be drawn up with the help of a real estate agent or lawyer.

This is especially true because of the listing of the contingencies on the receipt that allows the buyer to be refunded. Common contingencies include a lower appraisal, unsatisfactory housing conditions found from the inspection, not being able to obtain proper financing, or not being able to sell their current home. This can be quite an area of contention between buyers and sellers, and they may not agree on which contingencies should be put in place. This is why a real estate agent or lawyer should help draft the earnest money deposit receipt.

Of course, after the receipt is drafted and the money is transferred to the title company from the buyer, anyone from the title company can sign the receipt. It is just important for someone who is licensed to help in the drafting process.

How Close Concierge Can Help

Close Concierge is dedicated to handling your real estate transactions for your business. Some of the exchanges that we take care of are tracking the earnest money receipt and storing it for compliance, coordinating between the buyer and seller, ensuring all contingencies are met and on time, scheduling inspections, and even more.

It is our goal that all transactions and exchanges are taken care of by our coordinators from the start of the contract to its completion. This way, you can have more time to focus on what matters to you: growing your business.

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