I am going to meet with a seller later today to sign a purchase contract and he wants to see me fill out the check for the earnest money. Do I make the check out to the title company?
The earnest deposit is $1,000. If I cannot bring a buyer before the inspection period is over which will be 14 days, do I lose that money?
Also, I assume I should request access to the property immediately upon signing the contract and get a lockbox to put on it. Is that correct?
Hey Bryan congrats on your first property. Talk to your title company that is going to be holding the check until closing to see what they want you to do. More than likely the check will be made out to the seller. Do not give the check directly to the seller.
14 days is a very short time to wholesale a property. I put 45 days in all my contracts but let the sellers know that I close as fast as possible and about 3 weeks on average.
As far as losing the earnest money that will depend on what is in your contract. I always put "contingent on financing" and " contingent on inspection" clauses in my contracts so if for any reason I can not close on the property I will not lose any earnest money. If you did not put any contingencies then yes you could lose it.
Last, if the property doesn't have tenants then put a lockbox on it immediately and start shopping it to your buyers.
The earnest money goes to the title company who holds it in escrow. In some states the real estate broker holds the earnest money in an escrow account.
The answer to question #2 depends on what the contract states. If there's a "contingent upon" clause or another clause allowing you to back out, then you should get your earnest money back. If not, then you could lose your earnest money.
For the earnest money? You can send it over by UPS or FedEx. I wouldn't stick it in the mail.
Thanks @Fred Heller
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