Contracts
In NJ real estate, 'earnest money' differs from the 'down payment' because:
AThey are exactly the same thing
BEarnest money is an initial deposit showing good faith; the down payment is the total equity contribution at closing (which may or may not include the earnest money)✓ Correct
CThe down payment is always larger
DEarnest money is only required in commercial transactions
Explanation
Earnest money is the initial deposit made when the contract is signed as evidence of good faith. The down payment is the total equity contributed at closing; in many NJ transactions, the earnest money is credited toward the down payment at closing.
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