Earnest Money and the AAR Contract: What You're Actually Signing

What earnest money actually does

Earnest money is a deposit — typically around 1% of the purchase price in the Phoenix metro, though it's negotiable — that you put down after your offer is accepted to show the seller you're serious. It's held by a neutral third party (usually the title/escrow company, not the seller or either agent) and gets applied toward your down payment and closing costs at closing.

The deposit is refundable if you cancel the contract within your contractual rights — like during the inspection period, or if your loan doesn't get approved — but can be at risk if you cancel outside those protections. This is exactly why the deadlines in the contract matter so much.

The AAR contract

The Arizona Association of REALTORS® Residential Resale Real Estate Purchase Contract — usually just called 'the AAR contract' — is the standardized form used in the vast majority of Arizona home sales. Because almost everyone uses the same base document, the negotiation happens mostly in the price, dates, and a handful of specific terms, not in reinventing the contract from scratch each time.

Key sections first-time buyers should read closely: the close of escrow date, the loan contingency period, the inspection period, and the section on home warranty and who pays which closing costs.

The inspection period and the BINSR

Arizona's standard inspection period is 10 days from acceptance (it's negotiable, and can be shorter in a competitive market). During this window, you can have the home professionally inspected and submit a Buyer Inspection Notice and Seller Response (BINSR) requesting repairs, a credit, or a price adjustment.

The seller can agree, negotiate, or decline. If you can't reach an agreement, you generally have the right to cancel and get your earnest money back — but only if you act within the contractual deadline. Missing that window is one of the most common (and avoidable) mistakes first-time buyers make.

Other deadlines that protect you

Beyond inspection, the contract sets deadlines for your loan application, appraisal, and title review. Each one is a checkpoint where you can renegotiate or exit the contract under specific conditions. Missing a deadline — even by a day — can waive a protection you were counting on, which is why a good agent is tracking these dates as closely as your lender is.

Conclusion

None of this is meant to be memorized — it's meant to be walked through, line by line, with someone who reads this contract every week. Matt goes through the full AAR contract with every first-time buyer before they sign anything, so you know exactly what each deadline protects and what happens if you miss one.