The deposit is the money a buyer puts down when their offer is accepted — proof they're serious, and the first sign of how committed they really are. Here's how deposits work in Ontario.
How much is normal
There's no fixed rule; a common range is a few percent of the purchase price, larger in competitive situations. A bigger deposit is a stronger offer, because it's more of the buyer's own money at risk if they walk away without cause.
Where the deposit is held
A deposit is not handed to the seller. It's held in a brokerage's trust account in accordance with Ontario's Trust in Real Estate Services Act (TRESA) and the rules of the Real Estate Council of Ontario (RECO). It sits there until the deal closes or is otherwise resolved. When List It handles your sale through Offer-to-Closing Support, the deposit is held in our brokerage trust account.
"Herewith" vs "upon acceptance"
An offer will say the deposit is delivered either herewith (with the offer) or upon acceptance (usually within 24 hours of a firm/accepted deal). "Upon acceptance" is common; just make sure the timeline is clear and met.
What happens to it on closing
On closing, the deposit is credited toward the purchase price — the buyer's lawyer sends the balance, and the deposit is applied so the buyer doesn't pay it twice. It flows into the final accounting your lawyer handles.
If the deal falls through
What happens to a deposit when a deal collapses depends on why, and on the wording of the agreement — it can become a genuine dispute. This is exactly where you want your real estate lawyer, and it's another reason clear, well-drafted conditions matter.
General information for Ontario sellers, not legal advice. Deposit disputes are legal matters — consult your real estate lawyer.
List on MLS® for a flat fee — keep your commission
Full MLS® & REALTOR.ca exposure through a licensed Ontario brokerage, without the 5% commission.