Offer Accepted — Deposit Due Within 24 Hours

The standard OREA APS requires the buyer to deliver the deposit by the end of the next banking day after acceptance — by bank draft or certified cheque, not personal cheque.

Deposit Enters the Brokerage Trust Account

Typically the listing brokerage holds the deposit in trust, though the APS can specify the buyer’s brokerage. The trust account is strictly regulated by TRESA and audited by RECO.

Normal Closing: Deposit Applied to Purchase

Before closing, the brokerage releases the deposit to the buyer’s lawyer, where it is applied as part of the down payment to complete the transaction.

Breach Occurs: Deposit Frozen

If either party breaches, the brokerage cannot decide on its own to give the deposit to anyone. It stays in trust until a Mutual Release is signed or a court issues an order.

Who holds the deposit in an Ontario real estate transaction?

Under Ontario’s TRESA, the deposit must be held in a brokerage’s trust account — it cannot go directly to the seller or a sales representative personally. Typically the listing brokerage holds it until the closing date.

Does the seller automatically get the deposit if the buyer backs out?

No. When a buyer breaches the APS, the deposit does not automatically transfer to the seller. The seller must obtain either a signed Mutual Release from both parties or a court order before the brokerage can release the deposit.

What does the deposit clause in an OREA APS say?

The standard OREA APS deposit clause specifies the deposit amount, the payment deadline (typically by the next business day after acceptance), which brokerage’s trust account holds it, and that its disposition on breach is governed by Ontario law.

What is the difference between a deposit and a down payment?

A deposit is the up-front good-faith payment made shortly after the offer is accepted — it counts toward the total down payment. The down payment is the total buyer equity at closing (purchase price minus the mortgage loan). The deposit is part of, not in addition to, the down payment.

How much deposit is typical in Ontario?

There is no legal minimum, but market convention in Ontario is 3%–5% of the purchase price. In competitive Toronto markets, a higher deposit (5% or more) signals strong buyer commitment and can help in multiple-offer situations when other terms are equal.