Earnest Money When Buying Neighbor's House FBSO

[Kayla Strozier]

I have a rental property that is a townhouse. My next-door neighbor to my townhouse has agreed to sell her townhouse to me. We are doing this without realtors. How is earnest money handled in cases of FSBO? Should I just write a check to her that she then has the option of depositing into her personal bank account (but be sure to include very detailed, specific language in the contract regarding the earnest money in case the sale does not go through)?

Any help would be greatly appreciated. Thanks!

[Shaun Weekes]

Originally posted by @Kayla Strozier:

I have a rental property that is a townhouse. My next-door neighbor to my townhouse has agreed to sell her townhouse to me. We are doing this without realtors. How is earnest money handled in cases of FSBO? Should I just write a check to her that she then has the option of depositing into her personal bank account (but be sure to include very detailed, specific language in the contract regarding the earnest money in case the sale does not go through)?

Any help would be greatly appreciated. Thanks!

If your state allows it, I would hire a Realtor and just have them represent both of you. Let them know that we already have a sales price, and everything done. Pay them a flat fee and call it a day regarding the Realtor. If you're dead set on not using a Realtor I would strongly recommend using a local title and escrow company to handle the EMD. Business is business and you're going to need to make sure that title is clean and insured etc. The last thing you want is to agree to something that you don't have all the information on.

I hope this helps and have a great day.