Should you wire earnest money to escrow before you have deal

[Pedro Guillen]

Hello bigger pockets community,

I’m working with a wholesaling company and one of their strategies is to have their cash buyers lined up ready to go under contract on the day they find deals. My question is should you wire earnest money to escrow title company before you have a deal with wholesaler? Is this common practice dealing with big wholesaling companies and should I be skeptical? Wholesaler claims that investors with earnest money deposited in escrow will have first pick at deals they find.

Any advise or bad experiences you can share would be greatly appreciated.

Thanks

Pedro Guillen

[Brad Bellstedt]

Absolutely not. Until you are in contract on a property, there is nothing to put a deposit on. Plus, it takes literally 20 minutes to wire over your EMD. If it took a couple of days, I could see that being a legitimate request but in my experience and from all the stories I've heard, it's NEVER a good idea to wire money to anywhere but escrow and only after an agreement has been made, in writing.