MICRO-PROJECT REPORT ON

“PREPARE A REPORT ON EARNEST MONEY DEPOSIT AND ITS IMPORTANCE”

2024-2025
This Micro-Project Work Submitted In Partial Fulfillment of Requirement for the
Award of Diploma In
CIVIL ENGINEERING
Under The Guidance Of
Mr.N.A.Bhange
(Lecturer in Civil Engineering)

SUBMITTED BY
Name of Students Roll No Enrollment No.
Aman Nasir Pathan 20 23310240094

1
 GOVERNMENT POLYTECHNIC, BRAMHAPURI
DIST-CHANDRAPUR
DEPARTMENT OF CIVIL ENGINEERING

Certificate
This is to certify that the following students of this institute have carried out this project work on “Prepare
a report on types of specification in civil engineering.” under the guidance of Mr.N.A.Bhange lecturer
in Civil Engineering during the session 2024-2025 This work has been done in the partial fulfillment of the
award for Diploma in Civil Engineering from Maharashtra State Board of Technical Education, Mumbai.

SUBMITTED BY:-
Aman Nasir Pathan (20)

Mr.N.A.Bhange Ku.M.T.Nagdeve
Project Guide Civil Engg. Department
(Lecturer in Civil Engineering) (HOD)
Dr.R.L.Wankhade
(Principle of Govt poly. Bramhapuri)

2
 GOVERNMENT POLYTECHNIC,BRAMHAPURI
DIST-CHANDRAPUR
DEPARTMENT OF CIVIL ENGINEERING

SUBMISSION

We are students of Third year of Department of civil engineering ,humbly

completed this Micro-project work for time to time as described in this report by
my own skill and study between the period from 2024-2025. A per instruction
and guidance of Mr.N.A.Bhange and following students was associated for this
work. However, quantum of my contribution has been approved by the guide.

SUBMITTED BY:-

Name of Students Roll No. Date

Aman Nasir Pathan 20 / /2025

GOVERNMENTPOLYTECHNIC,BRAMHAPURI
3
 DIST-CHANDRAPUR

ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to my Management teacher

Mr.N.A.Bhange who gave me an opportunity to do this project and also provided
support in completing in project. I would also like to extend my gratitude to our Head
Department Ku.M.T.Nagdeve Mam for providing me with all the facilities that were
required. .

INDEX
4
 Sr. Contents Page.No
No
1. Introduction 6

2. Proposal Part-A

1.Aim of Project
2.Course outcomes 7 to
3.Proposed Methodology
4.Action Plan 8
5.Resources Required
6.Name of team members

3.
Proposal part-B
1.Aim of Micro-Project
9
2.Rationale
3. Course Outcomes 10 to 14
3.Literature Review
4. Actual Methodology followed
5.Actual Resources Used
15 to 16
6.Output of the Micro-project
7.skilled development
8.Application of the Micro-project
9.Conclusion 17
10.Evaluation sheet.

INTRODUCTION

5
 Specifications in civil engineering refer to detailed, precise descriptions of materials, workmanship, and
construction procedures. They form a critical part of construction contracts, ensuring clarity, quality, and
consistency in project execution.

PART–A

“PREPARE A REPORT ON TYPES OF SPECIFICATION IN CIVIL ENGINEERING”

6
 1.0 Aims of Micro-project
“Prepare a report on types of specification in civil engineering”

2.0 Course Outcomes

Prepare the tender documents for civil engineering works.

3.0 Proposed Methodology

1) We have discussed the topic among the team member.

2) We have prepared proposal of micro-project.

3) We have prepared report as per guidance of subject teacher.

4) To prepare project report and submit.

4.0 ActionPlan

Sr. Details of Activity Planned Start Planned Finish Responsible members

No Date Date (Roll no.)

1. Discussed about the topic Muskan Mobinulhak

with group members Sheikh

2. Collection of information Muskan Mobinulhak

Sheikh

3. Check the collected Muskan Mobinulhak

information from subject Sheikh
teacher

7
 4. Print the edited Muskan Mobinulhak
information in Sheikh
suitable font size

5.0 Resources Required

Sr. No Name of material Specification Qty

1. Laptop Lenovo -

2. Books Estimating and costing 01

[By Birdie.G.S]

3. Internet www.mahapwd.com As per required

6.0 Name Of Student

Name of Student Roll No.
Aman Nasir Pathan 20

PART –B
“PREPARE A REPORT ON TYPES OF SPECIFICATION IN CIVIL ENGINEERING”

1.0 Aims of Micro-Project

• “Prepare a report on types of specification in civil engineering.”.

2.0 Rationale

For infrastructure development various construction projects are required to be undertaken. These projects
are to be executed by entering into a legal contract.The diploma student shall have adequate knowledge of
different types of accounting procedures of organization about the projects are to be executed by entering

8
 in to legal contract.The procedure of execution of work by various organizations will be useful while
working as an engineer in organization to execute various works.Concept of tenders and knowledge about
preparation of tender documents,writing specification for different items of work will be helpful to prepare
actual Tender papers and contract documents which are required before execution of construction. The
information of procedures and different types of forms used by department will be useful to prepare bills
and different modes of payments to contractors . This course will help the student in implementing actual
field practices,which will make student further more competent in the execution of civil engineering
works.

3.0 Course Outcome

• Prepare the tender documents for civil engineering works.


LITERATURE REVIEW

What Is Earnest Money?

Earnest money is a deposit made to a seller that represents a buyer's good faith to make a purchase such as the
acquisition of a new home. In many ways, earnest money can be considered a deposit on a home, an escrow
deposit, or good faith money.
KEY TAKEAWAYS
 Earnest money is essentially a deposit a buyer makes on a home they want to purchase.
 A contract is written up during the exchange of the earnest money that outlines the conditions for
refunding the amount.

9
  Earnest money deposits can be anywhere from 1–10% of the sales price, depending mostly on market
interest.
 Should a buyer break the terms of the contract, they may be at risk of losing their earnest money
deposit.
 However, there are a number of potentially agreed-upon contingencies that may protect the buyer
from backing out of a deal but still keeping all of their earnest money.

Understanding Earnest Money

In most cases, earnest money is delivered when the sales contract or purchase agreement is signed, but it can
also be attached to the offer. Once deposited, the funds are typically held in an escrow account until closing,
at which time the deposit is applied to the buyer's down payment and closing costs. The money gives the
buyer extra time to get financing and conduct the title search, property appraisal, and inspections before
closing.
When a buyer decides to purchase a home from a seller, both parties enter into a contract. The contract
doesn't obligate the buyer to purchase the home, because reports from the home appraisal and inspection may
later reveal problems with the house. The contract does, however, ensure the seller takes the house off the
market while it's inspected and appraised. To prove the buyer's offer to purchase the property is made in good
faith, the buyer makes an earnest money deposit (EMD).
The buyer might be able to reclaim the earnest money deposit if something that was specified ahead of time
in the contract goes wrong. For instance, the earnest money would be returned if the house doesn't appraise
for the sales price or the inspection reveals a serious defect—provided these contingencies are listed in the
contract.
IMPORTANT
In general, earnest money is returned to the buyer if the seller terminates the deal but is awarded to the seller
if the buyer unreasonably terminates the deal.
How Much Are the Earnest Money Amounts?
While the buyer and seller can negotiate the earnest money deposit, it often ranges between 1% and 2% of the
home's purchase price, depending on the market. In hot housing markets, the earnest money deposit might
range between 5% and 10% of a property's sale price.
While the earnest money deposit is often a percentage of the sales price, some sellers prefer a fixed amount,
such as $5,000 or $10,000. Of course, the higher the earnest money amount, the more serious the seller is
likely to consider the buyer. Therefore, a buyer should offer a high enough earnest deposit to be accepted, but
not one so high as to put extra money at risk.
A seller may also require ongoing, periodic earnest deposits to have a prospective buyer continue to show
good faith during their due diligence process. For example, a seller may require a buyer to make monthly
earnest deposits on a fixed schedule over a three month due diligence period. Should the buyer fail to meet
any earnest money deposit requirements, the seller may be entitled to bring the property back to market and
potentially recover losses via keeping portions of the earnest money.
How Is Earnest Money Paid?
Earnest money is usually paid by certified check, personal check, or a wire transfer into a trust or escrow
account that is held by a real estate brokerage, legal firm, or title company. The funds are held in the account
until closing, when they are applied toward the buyer's down payment and closing costs.

10
It's important to note that escrow accounts, like any other bank account, can earn interest. If the earnest funds
in the escrow account earn interest of more than $600, the buyer must fill out tax form W-9 with the IRS to
receive the interest.1
FAST FACT
Different jurisdictions may have different legal circumstances around earnest money. For example,
Washington state legislature stipulates slightly different definitions than Minnesota statutes.23
Is Earnest Money Refundable?
Earnest money isn't always refundable. The good news for buyers is in most situations, as long as a buyer acts
in good faith, earnest money is refundable. As long as any contract agreements are not broken or decision
deadlines are met, buyers usually get their earnest money back. Specific conditions where buyers often get
their earnest money back include:
 If a home inspection reveals there are material issues with a property being sold. The buyer can
usually choose to negotiate who is responsible for the repairs or can back out of the purchase.
 If a home appraises for lower value than the agreed purchase price. The buyer can negotiate a lower
purchase price or can back out of the purchase price.
 If a buyer is unable to sell their current house (as long as this home sale contingency is agreed upon).
 If a buyer is unable to obtain a loan/financing (as long as this funding contingency is agreed upon).
Every situation is different, but broadly speaking, the seller gets to keep the earnest money if the buyer
decides not to go through with the home purchase for reasons not specified as part of the contract. For
example, if a buyer simply has a change of heart decides not to buy the property, the seller is most likely
entitled to retain earnest money proceeds.
Protecting Your Earnest Money Deposit
Prospective buyers can do several things to protect their earnest money deposits.
 Make sure contingencies for financing and inspections are included in the contract. Without
these, the deposit could be forfeited if the buyer can't get financing or a serious defect is found during
the inspection.
 Ensure contract terms are in writing. The contract agreement between a buyer and seller should be
in writing. This clarifies any misunderstandings and sets the precedence for terms of the agreement.
Amendments to the contract are always allowable, but ensure that every iteration of the agreement is
in writing and signed by both parties.
 Read, understand, and abide by the terms of the contract. For example, if the contract states the
home inspection must be completed by a certain date, the buyer must meet that deadline or risk losing
the deposit—and the house.
 Utilize an escrow account to hold funds. Do not send escrow money directly to the seller; if the
funds are in direct possession by the other party, they can control the funds and not release funds even
if you are entitled to earnest money refunds.
 Make sure the deposit is handled appropriately. The deposit should be payable to a reputable third
party, such as a well-known real estate brokerage, escrow company, title company, or legal firm (never
give the deposit directly to the seller). Buyers should verify the funds will be held in an escrow
account and always obtain a receipt.
Earnest Money vs. Down Payment
Earnest money and down payments are both used in real estate transactions, yet they serve different purposes.
Earnest money is a sum of money provided by the buyer to prove seriousness. On the other hand, a down

11
payment is usually a larger sum of money paid by the buyer at the time of closing to secure financing for the
purchase of the property.
Unlike earnest money, which is more of a gesture of commitment, the down payment represents a portion of
the total purchase price and is required by lenders as a form of collateral. The size of the down payment is
determined by various factors including the type of mortgage, the lender's requirements, and the buyer's
financial situation. For instance, for transactions where the seller has more risk, they may require a higher
down payment (i.e. 20% of the acquisition price as opposed to 10%).
The down payment reduces the amount of money that needs to be borrowed, thereby lowering the loan-to-
value ratio and potentially improving the terms of any mortgage. While earnest money could be applied as a
down payment, it is usually returned to the buyer as part of the transaction as it initially never represented a
portion of the purchase price .
Example of Earnest Money
Suppose Tom wants to buy a home worth $100,000 from Joy. To facilitate the transaction, the broker
arranges to deposit $10,000 as a deposit in an escrow account. The terms of the subsequent agreement signed
by both parties state that Joy, who is currently living in the home, will move out of it within the next six
months.
However, Joy is unable to find another place of residence by moving day. As a result, Tom cancels the
transaction and gets his deposit money back. The deposit money has earned interest of $500 from the escrow
account during this time period. Since the amount is less than $600, Tom is not required to fill out an IRS
form to retrieve the amount.1
What Is Earnest Money?
In real estate, earnest money is effectively a deposit to buy a home. Usually, it ranges between 1-10% of the
home’s sale price. While earnest money doesn’t obligate a buyer to purchase a home, it does require the seller
to take the property off of the market during the appraisal process. Earnest money is deposited to represent
good faith in purchasing the home .
Who Keeps Earnest Money If a Deal Falls Through?
Earnest money gets returned if something goes awry during the appraisal that was predetermined in the
contract. This could include an appraisal price that is lower than the sale price, or if there is a significant flaw
with the house. Importantly, though, earnest money may not be returned if the flaw was not predetermined in
the contract or if the buyer decides not to purchase the house during an agreed-upon time period.
How Can Earnest Money Be Protected?
To protect an earnest money deposit, prospective buyers can follow a number of precautionary steps. First,
buyers can ensure that contingencies apply to defects, financing, and inspections. This protects the deposit
from being forfeited in the case that a major flaw is discovered, or that financing is not secured. Second,
carefully read and follow the terms of the contract. In some cases, the contract will indicate a certain date by
which the inspection must be made. To prevent forfeiture, the buyer should abide by these terms accordingly.
Finally, ensure the deposit is handled adequately, which means that the buyer should work with a reputable
broker, title firm, escrow company, or legal firm .
Do You Get Earnest Money Back?
As long as a buyer follows the terms of the contract and adheres to all deadlines agreed to with the seller, a
buyer will most often receive their full earnest money deposit(s) back. Should the buyer fail to comply with
the agreement, the seller may be entitled to receive some or all earnest deposit funds.

12
 How Do You Lose Earnest Money?
In an agreement between a buyer and seller, there are often a number of contingencies outlined that spell out
the terms where a buyer may back out of an agreement. These contingencies include failure of a home
inspection, failure to secure financing, or failure to sell a separate existing property.
If the buyer decides to not proceed with the sale for reasons outside of these agreed to contingencies, the
buyer is at risk of losing earnest money.
The Bottom Line
When a buyer and seller enter into an initial agreement to transfer ownership right of property, the buyer is
often required to make a deposit of earnest money into an escrow account. There's a number of reasons the
buyer and seller can agree to where the buyer can back out of the agreement. However, should the buyer
break contract or not meet required deadlines, the seller may be entitled to keep the earnest money as
compensation for the break of good faith.

4.0 Actual Methodology Followed

1) We have discussed the topic among the team member.

2) We have prepared proposal of micro-project.
3) We have prepared report as per guidance of subject teacher.
4) To prepare project report and submit.

5.0 Actual Resources Used

Sr. No Name of material Specification Qty

1. Laptop Lenovo -

2. Books Estimating and costing 01

[By Birdie.G.S]

3. Internet www.mahapwd.com As per required

6.0 Outputs of this Micro-Project

Prepare the tender documents for civil engineering works.

7.0 Skill Developed

We are able to know about earnest money deposit and its importance.

13
 8.0 Application of this Micro-Project
This microproject serves as an educational and informative guide for buyers, sellers, and real estate
professionals to understand the significance of Earnest Money Deposits. It can be applied in real estate
training programs, financial literacy courses, and as a reference document for individuals involved in
property transactions. Additionally, it can be used by legal and financial advisors to help clients make
informed decisions when engaging in real estate deals.

9.0 Conclusion
Earnest Money Deposits play a pivotal role in real estate transactions by fostering trust between buyers and
sellers, reducing uncertainties, and ensuring financial accountability. Buyers should carefully review contract
terms and work with real estate professionals to understand the conditions that govern the deposit to safeguard
their investment.

1.0References
1. https;//mahatenders.gov.in
2. https;//cpwd.gov.in/cpwde_tender.aspx
3. https://gem.gov.in

Evaluation Sheet
Name of Student :- Muskan Mobinulhak Sheikh

Enrollment No :- 23310240099 Roll No. :- 43

Name of Program :- Civil Engineering Semester :- sixth

Course Title :- Contracts and Account Code :- 22601

Title of the Micro project :- Prepare a report on earnest money deposit and its importance.l.
14
 Course outcomes :- Prepare the tender documents for civil engineering works.
Sr.no. Characteristics to be Poor Average Good Excellent Sub
assessed (marks 1-3) (marks 4-5) (marks 6-8) (marks total
9-10)
1. Relevance to the
course
2. Literature
Review / Information
collection
3. Completion of the
target as per project
proposal
4. Analysis of data and
representation
5. Quality of
prototype /
model
6. Report preparation
7. presentation
8. viva
.

Process and product assessment Individual presentation /viva Total (10 marks)
(6 marks) ( 4 marks)

Comments / Suggestion about team work / Inter-personal communication

Name and designation of the teacher :- Mr.N.A.Bhange

Dated Signature :- / / 2025

15