So i was out today and seen a few bandit signs so i got the numbers and called. 1st time cold calling and it was nerve wrecking at 1st but as soon as i hung up i felt like i was a kid who just got his training wheels taken off lol. but any who i called a number and didn't get an answer but he called back and i didn't answer which was a good thing bc he left a message and so i got to study his vm for when i have to leave a voicemail. So we're chatting and we exchange info and said we'll send each other properties yada yada so i get a text that says
"Okay I have you locked in now Ian. I will send a list compilation of SFR properties that are available. All I require is $1,500 EMD to be ready when submitting offers (3-Day Refundable Due Diligence). Send me deals that you have as well. Looking to close quickly."
so my question is why does he require a $1500 emd when submitting offers? does he want me to have a contract with $1500 in EMD?? im confused 😩
@Ian Bethel If he's selling his own properties, he can require anything he wants.
The reason that some will ask for higher EMD is that it makes it less likely that you'll walk away from the deal in such a way that requires that you sacrifice your EMD, i.e., you waived the inspection contingency, but then get spooked by the property condition.
Of course, if he's marketing properties that he doesn't already own, he most likely has to be licensed. If he's not, you already have reason to suspect that he's shady. Check your state's laws to be sure.
If you do offer EMD to a wholesaler, be SURE that it's held in escrow by a reputable real estate attorney or title company.
@CharlieMacPherson Great information and thanks for your speedy response. So lets say he has a contract on a property. Can i make money if i brought him a buyer?
@Ian Bethel yes, it's called a joint venture. you two sign a JV contract specifying the deal, you bring your cash buyer, all contracts got to title company, then you two split the assignment fee that was agreed upon.
If you are looking to wholesale why not create your own leads?
Join the Largest Real Estate Investing Community
Basic membership is free, forever.