Wholesaling a Multifamily Property - Earnest Money and Title Fees

[Keith Meyer]

I'm in process of putting a multifamily property under contract, with the plan to either purchase myself or wholesale the contract. The Seller is a pretty typical Mom and Pop, and does not seemed concerned over collecting an Earnest Money deposit. I'm planning to include a small EMD into the purchase agreement anyway, in order to demonstrate consideration and legitimize the contract. This will require the opening of an escrow account, and with that will guarantee at least a few thousand $$ in title company/escrow fees, even if the deal falls through.

Given that there have already been a few surprises with this property and I'm not sure how confident I can be at this point that the deal will progress to closing, what's the best way to minimize both mine and the Seller's out of pocket exposure in the event the deal falls through quickly? My EMD would be refundable in the contract, but we would need to establish escrow and the Seller would need to open a Title Insurance policy right off the bat, even if I elected to assign the contract. This is a couple thousand $$ at risk for both of us, which I understand is the nature of the business but just wondering if there's a more creative way to avoid this? If I assign the contract I would collect a non-refundable deposit from the end Buyer to cover my EMD and part of my Assignment Fee. However I'd still like to protect all three parties from spending thousands in escrow fees on a high risk deal.

If the answer is "do as much diligence as you can prior to signing the contract", then fair enough. Just wondering if there's another creative approach I could take here. Thanks!