How much should the earnest money deposit be?
There is no set amount. Different areas have different customs. In the Dallas area, 1% of the sales price is common.
As a buyer it is a good idea to contact the title company that you will be making your check to and inquire about their refund policies. Each title company has different rules that they follow. Most title companies will not release earnest money to a buyer without the seller's written permission or to the seller without the buyer's written permission. This causes a lot of problems.
If either party refuses to release the earnest money it requires a judgment from a judge (Small Claims Court) to have the money released.
WARNING: Verbiage in the contract makes any party that wrongly refuses to release the earnest money liable for 3 times the amount of the earnest money. As a buyer or seller if you refuse to release the earnest money make sure that you are correct in doing so.