Seller wants 5% escrow and 10 days to apply for financing?

[Tom Tran]

Hello,

Is it normal for seller to asked for 5% escrow down, and 10 days to get financing on the subject property? We have an agreed price for an 18 duplexes at $900k, we put in the agreement escrow of $20,000. My question is why the seller is asking for such a high escrow down? the contract is contingent on financing and inspection so we would get that money back anyway...can you guys help understand the reason behind the seller request?

thanks, Tom.

[Richard C.]

If I had to guess, I would say that they were victimized by a wannabe wholesaler in the past, who was not able to actually perform, and they therefore are using the EMD as a test of your ability to actually come up with some money. This is particularly true if there is anything unusual about your financing plan, or the proof of funds/financing you provided.