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Welcome to OptionRally Academy, I'm Amy Anderson with the Term of the day.
Today we are going to talk about Good Faith Deposit.
Good Faith Deposit refers to depositing money into an account by a buyer who wants to show
that he has the intention of completing the deal. In most cases, the deposit amount will
be a percent of the amount owed. It is an initial deposit that guarantees the buyer
or seller's intention to complete the transaction or purchase.
An example would be a homebuyer depositing money into an account. When this is done,
the seller of the home knows that the buyer will fulfill the terms of the contract and
make the purchase.
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