Legal Definitions - arrha

Definition: Arrha (pronounced ar-uh) is a Latin term used in Roman and civil law to refer to earnest money. It is the money given as proof that a bargain has been completed.

Example: When buying a house, the buyer may give the seller a sum of money as arrha to show that they are serious about the purchase. This money is usually held in escrow until the sale is finalized.

Explanation: The example illustrates how arrha is used in a real estatetransaction. The buyer gives the seller a deposit as arrha to show that they are committed to buying the property. This deposit is a sign of good faith and is usually held in a separate account until the sale is completed. If the sale falls through, the arrha may be forfeited to the seller as compensation for their time and effort.