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Deposit

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Deposit has two distinct meanings. Meaning one is applied to funds provided as security or collateral for expected delivery of a good. For instance in a real estate acquisition, a deposit is provided in advance of closing. The exact timing and amount varies depending upon the part of the country. A real estate purchase deposit may be called a good faith deposit, a contract deposit, or simply a deposit. The second meaning of deposit is applied to funds transferred to another party, typically a financial institution, for safekeeping. An account holder who submits money to a credit union or bank for addition to the owner's account balance is said to make a deposit. A direct deposit is a type of payment where the payor transfers funds for the benefit of the payee to the financial institution where the payee has an account.



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