How Century Communities Uses This Clause
Century Communities purchase agreements have been documented to include deposit forfeiture / earnest money trap provisions. Like other production builders, Century Communities contracts may allow the builder to retain the earnest money deposit as liquidated damages if the buyer fails to close. Buyers should verify refund conditions and whether builder-caused delays or defects trigger any deposit protections.
This provision typically appears within the purchase agreement alongside other terms that may limit buyer remedies. Because Century Communities operates across multiple states, the enforceability and practical impact of this clause varies depending on where the home is located.
Century Communities's scale means contract templates are largely standardized across its operations. A clause identified in one market's contract is likely present in other markets' contracts, though local addenda may modify the terms.
Builder-Specific Details
Combined with Mandatory Arbitration
Deposit disputes must go through arbitration, where the cost may approach or exceed the deposit itself.
Standardized Across Markets
Century Communities's scale means contract templates are largely standardized across its operations. This clause identified in one state's contract is likely present in other states' contracts, though local addenda may modify the terms.
Standard Form Contract
This clause appears in Century Communities's standard purchase agreement, which is generally presented on a take-it-or-leave-it basis. Buyers typically have limited ability to negotiate individual terms, though making the request in writing is still advisable.
State-by-State Enforceability
Enforceability of this clause varies by state. The following reflects Century Communities's operating states.
| State | Status | Note |
|---|---|---|
| Texas | Likely Enforceable | Deposit forfeiture clauses in new construction contracts are generally enforceable in Texas when... |
| Colorado | Likely Enforceable | Colorado courts enforce liquidated damages clauses, including deposit forfeiture provisions, when... |
| California | Likely Enforceable | California has one of the most detailed statutory frameworks governing liquidated damages in... |
| Arizona | Likely Enforceable | Arizona courts enforce deposit forfeiture clauses as liquidated damages when the amount is... |
| Nevada | Likely Enforceable | Nevada courts enforce liquidated damages provisions when the amount is reasonable relative to... |
| Florida | Likely Enforceable | Florida courts generally enforce deposit forfeiture provisions in new construction contracts when... |
| Georgia | Likely Enforceable | Georgia courts enforce liquidated damages provisions when the amount is a reasonable pre-estimate of... |
| North Carolina | Likely Enforceable | North Carolina courts enforce liquidated damages provisions, including deposit forfeiture in new... |
| South Carolina | Likely Enforceable | South Carolina courts enforce liquidated damages provisions in real estate contracts when the amount... |
| Tennessee | Likely Enforceable | Tennessee courts enforce liquidated damages provisions when the amount is reasonable in proportion... |
| Utah | Likely Enforceable | Utah courts enforce liquidated damages provisions when the amount is a reasonable pre-estimate of... |
| Washington | Likely Enforceable | Washington courts enforce liquidated damages provisions when the amount is reasonable relative to... |
| Oregon | Likely Enforceable | Oregon courts enforce liquidated damages provisions when the amount is reasonable in relation to... |
| Indiana | Likely Enforceable | Indiana courts enforce liquidated damages provisions when the amount is a reasonable estimate of... |
| Ohio | Likely Enforceable | Ohio courts enforce liquidated damages provisions when the amount is reasonable and the damages were... |
| Virginia | Likely Enforceable | Virginia courts enforce liquidated damages provisions in real estate contracts when the amount bears... |
| Idaho | Likely Enforceable | Idaho courts enforce liquidated damages provisions when the amount is a reasonable estimate of... |
| Alabama | Likely Enforceable | Alabama courts enforce liquidated damages provisions when the amount is reasonable relative to the... |
Related Clauses in Century Communities Contracts
This clause often works in combination with other provisions in Century Communities's purchase agreements.
Deposit disputes must go through arbitration, where the cost may approach or exceed the deposit itself.
Incentives tied to using the preferred lender may be lost if the buyer switches lenders, and the deposit terms may reflect this.
Closing penalties can create pressure to close quickly, and failure to close may trigger deposit forfeiture.
What Buyers Can Do
- Understand exactly when your deposit becomes non-refundable. The contract may specify triggers that make the deposit non-refundable before you expect. Read the forfeiture conditions carefully.
- Know the cancellation provisions. Review what happens to your earnest money if you need to cancel. Century Communities's contract may allow deposit retention even in circumstances beyond your control.
- Have the full contract scanned before signing. This clause is often one of several interconnected provisions in Century Communities contracts that collectively limit buyer remedies. A contract scan can identify all of them.