Definition of Earnest money
A sum of money paid by a buyer at the time of entering a contract to indicate the intention and ability of the buyer to carry out the contract. Normally such earnest money is applied against the purchase price. Often the contract provides for forfeiture of this sum if the buyer defaults. A deposit of part payment of purchase price on sale to be consummated in future. McGuire v. Andre, 259 Ala. 109, 65 So.2d 185, 190. Import of term “earnest money” in real estate contract is that when comparatively small sum is paid down, it is an assurance that party is in earnest and good faith and that if his being in earnest and good faith fails, it will be forfeited. Mortenson v. Financial Growth, Inc., 23 Utah 2d 54, 456 P.2d 181, 184.
That's the definition of Earnest money in Black's Law Dictionary 6th Edition. Courtesy of Cekhukum.com.