10K EMD for a foreclosure home?

[Dillan Mamou]

Hello, I found a listing on Craigslist for 180K and I offered 160K and they were very interested. I find it kind of strange that they were so eager. It's a foreclosure home so they need a fast closing. They wanted a 10K EMD just in case I don't perform. I'm sending someone out for an inspection. What are your thoughts because it feels kind of weird to me being out of state and my first investment home!

[Charlie MacPherson]

I might be wrong, but this sounds like a scam, partially because you found it on Craigslist which is ground zero for scammers.

As @Marshall Leipprandt said, you need local help.  An agent to see the home.  A title company / closing attorney to run a title report.  A home inspector to go through the house.

$10K EMD isn't necessarily out of line, but who are they suggesting holds it? If they want to hold it themselves, that raises the scam alert even higher. It should be in escrow with YOUR attorney or title company, not theirs - because I'll bet that theirs is a complete fabrication. That'll be the end of your $10K.

You say it's a "foreclosure home".  What does that mean?  Pre-foreclosure?  Actually foreclosed?

If it's pre-foreclosure, you might be on to something.  If it's already foreclosed and bank-owned, you can only buy it from the bank.

You don't say where the property is, but maybe do a Google street view and see what the neighborhood looks like.  Then do some searching to see what local values are.  If this property is in reasonably good shape and priced very low, that's another clue that it's a scam.

In other words, if the deal looks too good to be true, it probably is.

Proceed with extreme caution.