Pop quiz – if a contract gets canceled, are you able to get the earnest money deposit (EMD) released?
If you said yes, you’re in for a shock – the answer is no.
Whether you’re just starting out in real estate wholesaling or have been in the industry for years, many wholesalers believe that should they have a canceled contract, they’ll be able to get the earnest money released out of escrow.
And unfortunately, that’s just not true.
Ultimately what happens is you end up having to chase down the buyer in order to have them release that money or worse case, they can’t or won’t sign the release and then that EMD just sits in escrow forever.
Now I know what you’re thinking – OMG, that sounds horrible! There’s no way to counteract that!
Again, not true.
I’ve talked about what you should do in case your contract gets canceled and how to make sure that you’re filling out your assignment correctly. But I think people miss this one thing that’s so important.
It’s a literal game changer and it’s really as simple as making a declaration in your contract.
Adding Specific Terms within Your Assignment Contract
Guys, I’m about to blow your minds! And when I tell you what this amazing thing is, you’re going to slap your forehead and go, “why didn’t I think of that?”
If you want to make sure that your EMD is released and sent back to you, simply make that a term within your contract.
That’s the first step.
The second is ensuring that the title company you use will honor your contract and honor those terms, because if they don’t, that’s not a company you want to work with.
No one wants to go chasing down people - you hate it, I hate it, everyone hates it – and it’s a huge time sink when you could be out finding and closing deals.
And the people getting chased don’t enjoy it either.
Overall, it’s just a headache for everyone involved. And the best part is, if you have it in your contract, you can avoid these types of headaches.
If you want to know more, I had this exact conversation with one of my Astro members during one of our live calls:
As I explain, this workaround not only works, but is the best way to ensure that you have all your EMD ducks in a row, without having to chase down buyers.
It’s all about the language and about ensuring that the language is honored by the title company.
Guys, if you’re still chasing down buyers and need help with assignment contracts, don’t stumble and bumble about – come join us at AstroFlipping and get that EMD, yo!
Greetings from the whimsical realm of Watermelon Games, where the challenge of preventing items from overflowing meets the fun of stacking and merging! This category offers you a selection of combining puzzle games that offer hours of strategic gameplay, all inspired by the popular Suika Game, sometimes referred to as the watermelon game.
It’s a literal game changer and it’s really as simple as making a declaration in your contract.
snow rider