Earnest money deposit
Hey BP community I am new to real estate and I have am become very interested in using wholesaling as an investment strategy. I have currently been looking over several purchase and sale agreements used for wholesale deals, and I wanted to ask if anyone knows if the seller holds the funds for the earnest money deposit; for the property under contract, or is it given to a third party until the deal is closed? Thanks for your time and I’m looking forward to your replies!
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#5 All Forums Contributor
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- The Woodlands TX / Avon, Ct
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#5 All Forums Contributor
- Investor
- The Woodlands TX / Avon, Ct
@Brandon Lewis, you should know that wholesaling is not an investment strategy; it is a job or a business, just like being a real estate broker, but without the license.
Since your new to the industry, let me clarify because various people with mentoring programs to sell will misuse labels so prospective customers may be more willing to part with their $.
Wholesaling, as the term is used currently, is a job, just like being a real estate agent.
Buy, fix and flip is a business, just like any business that buys raw materials, adds value, and sells it in the marketplace.
Neither are real estate investing. In order for it to be an investment, a purchase would have to be completed by said individual, who would hold the property for a period of time for rental income, capital appreciation, or both.
Even experienced real estate participants confuse the real estate business with real estate investing.
- Don Konipol
