Negotiating EMD with Seller

[Jerry Zhang]

Hi,

I just hopped of a call with a seller for a property where the terms were fine. However they requested a 5 figure EMD and we usually try to close with one in the 4 figures. What are strategies you use to convivence sellers to close with your EMD offered?

[Robert Rixer]

EMD is a fickle thing. Typically it's meaningless until it goes hard and percentages of pp have definitely dropped over the years. Old school investors typically value it more. It's hard to negotiate EMD down because then it gives the appearance that you're not a serious buyer. A buyer making a huge fuss about EMD is likely going to be a red flag in the seller's eyes.

Best way would be to negotiate a smaller amount up front and then put the balance of the EMD down once you've gone through your DD.