Earnest Money Deposit

Rental Property Investor · Baltimore, MD · Member since 2020 · 223 posts · 89 votes

Investors that do fix & flips. When you make multiple offers on properties that you would like to acquire, are you putting down earnest money with the official offer? Or you making verbal offers before proceeding to an official offer?

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Peter MckernanBusiness Member
Residential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
1y
Depends on how the wholesaler/seller wants it.. Typically a lot of wholesalers, it is verbal, then if you are going to get it you get an official offer to sign and submit with the amount of EMD you need to put in. You don't put that EMD in until that offer is accepted by the seller.
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- Tyrone Marson
  OP
  Rental Property Investor · Baltimore, MD · Member since 2020 · 223 posts · 89 votes
  1y
  @Peter Mckernan thanks for the feedback.
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Jake Knight
Lender · Elk Grove, CA · Member since 2016 · 190 posts · 94 votes
1y
The EMD should come after you are in contract, then wired to the closing agent.
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Marc Winter
Real Estate Broker · Northeast PA · Member since 2017 · 2k+ posts · 2k+ votes
1y
In PA, when working with other licensed brokers/agents, the emd is given to the listing broker. They hold it in escrow until closing or termination of the contract of sale. Check with your state or local MLS policy.
Verbal offers are kind of 'iffy' to me; we like to see a written offer, followed by emd if/when accepted.
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Andy SabischPro Member
Investor · Jackson, MS · Member since 2021 · 660 posts · 561 votes
1y
Contracts need to have EMD to be binding . . . and make sure you NEVER pay the EMD to the seller. Either give it to the seller's agent or the closing attorney / title company.
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