Earnest money is a deposit you pay when you make an offer on a home - it's a way to show the seller that you mean business. Usually you can't get it back, but there are several circumstances during the sale process that will generally allow you to recover your earnest money should you decide to pull out of the sale.
1. Seller Property Disclosures - In Oregon, homeowners generally need to complete - to the best of their knowledge - a detailed account of ownership, systems, features, modifications etc. that are associated with the property and the home . During the review period, you may discover that there is a history of repeated water in the crawl space, or there was an addition to the home that was not permitted. You may not want to deal with these type of things once you become a homeowner, so you have the ability to pull out from the sale.
2. Preliminary Title Report and CC&Rs - You will have the opportunity to review a preliminary title report provided by the Title Company that shows any liens, encumbrances, claims of title other than the seller, etc.. If the home is in an area with Covenants, Conditions and Restrictions associated with owning a home in that neighborhood, you will receive a copy of the CC&Rs and have a chance to review them. If there are items that will remain on title or terms in the CC&Rs that may affect your ability to comfortably live in the home, you are able to pull out from the sale.
3. Major Problems with the home - It may be your dream home at the surface level, but following the home inspection you find that there are major problems such as issues with the foundation, plumbing issues, or electrical items. In that case, you can generally get your earnest money back if the seller doesn't agree to fix the issues or provide some type of credit at closing.
4. Appraisal Contingency - The sales agreement in Oregon has standard language that indicates if the buyer is obtaining financing to purchase the home, the sale is contingent upon both the buyer and the property qualifying for financing. If the home appraises for less than the agreed upon sale price - you can negotiate with the seller to modify the terms, or you can generally get your money back and walk away from the deal.
5. Financing Contingency - In addition to the property qualifying, you will also need to qualify for the loan. If, after having fulfilled your obligation to do what is needed to obtain financing, you are unable to obtain a loan, the sale cannot proceed and you will generally get your money back.