03/22/2023
Happy Hump-Day and Wisdom Wednesday!
What is an Earnest Money Deposit (AKA EMD) and why is it often requested?
Although an EMD is not required for a deal to be valid in Michigan, an Earnest Money Deposit is made to represent the buyer's good faith in buying a home.
The EMD is given to the Realtor from the buyer and placed in an escrow account until the contract closes. The EMD will then be applied to the funds that the buyer has to bring to closing, like the down payment.
There are scenarios where an EMD may not be needed or requested, but typically the listing agent and the seller would like to see an EMD from the buyer to know that they are serious. In the event that the buyer withdraws from the contract for a valid reason, the EMD is returned to the buyer.
