If you’re considering using EMD funding, the biggest question is usually simple:
How does it actually work?
This guide walks through the EMD funding process step by step, from contract to closing, so you know exactly what to expect and how to avoid delays.
If you want a full conceptual overview first, start here:
👉 What Is EMD Funding in Real Estate? A Complete Guide for Investors & Wholesalers
Step 1: Get a Signed Purchase Agreement
EMD funding always starts with a valid, executed purchase contract.
The contract should clearly state:
- Purchase price
- Earnest money amount
- Due diligence or contingency periods
- Closing timeline
- Buyer name (you or your entity)
Without a signed contract, EMD funding cannot be placed.
Step 2: Confirm the Earnest Money Requirements
Next, identify:
- How much earnest money is required
- Where it must be sent
- The deadline for deposit
This is especially important in:
- MLS deals
- Land transactions
- Agent-represented properties
For guidance on typical deposit amounts, see:
👉 How Much Earnest Money Is Required in Real Estate Deals?
Step 3: Submit an EMD Funding Request
Once the contract is signed, you submit a funding request with:
- The executed purchase agreement
- Earnest money amount
- Escrow holder details
- Required deposit date
This allows the funding provider to review the deal structure and timing.
👉 Ready to get started?
Request EMD Funding Here
Step 4: Contract Review and Approval
The funding provider reviews:
- Contract terms
- Due diligence periods
- Exit strategy (assignment, closing, etc.)
- Timeline feasibility
This step helps ensure the deal can be funded cleanly and returned properly.
If you’re wholesaling, this ties closely to:
👉 EMD Funding for Wholesale Real Estate Deals
Step 5: EMD Is Sent to Escrow
Once approved:
- Funds are wired or delivered to the title company or attorney
- The EMD is held in escrow per the contract
- The seller receives confirmation
At this point, the deal is officially secured.
Step 6: You Execute Your Exit Strategy
With the property under contract, you proceed with:
- Due diligence
- Marketing to buyers (for wholesalers)
- Final underwriting (for investors)
The EMD remains in escrow while you execute your plan.
For timing considerations, see:
👉 When Should You Use EMD Funding?
Step 7: Deal Closes, Assigns, or Terminates
One of three outcomes occurs:
Deal Closes
- EMD is credited on the settlement statement
- Funds are returned or applied
Deal Is Assigned
- End buyer closes
- EMD is released or credited accordingly
Deal Terminates Properly
- EMD is returned per contract terms
Problems usually occur only if deadlines are missed.
👉 Learn how to avoid issues here:
Common EMD Funding Mistakes Investors Make
Step 8: EMD Is Returned or Credited
Once escrow releases the funds:
- The transaction is complete
- No long-term obligation remains
- Capital can be reused for future deals
This is why EMD funding is considered transactional, not long-term financing.
How Long Does the EMD Funding Process Take?
In most cases:
- Approval happens quickly
- Funds are placed within 24–48 hours
- Timing depends on escrow coordination
Planning ahead prevents last-minute stress.
Is EMD Funding a Loan?
No. EMD funding is deal-specific transactional capital, not a traditional loan.
If you’re comparing options, see:
👉 EMD Funding vs Using Your Own Cash
Final Thoughts
The EMD funding process is straightforward when contracts are clear and timelines are respected.
It’s designed to support deal flow not complicate it.
Once you’ve used it a few times, it becomes a routine part of how you manage earnest money across multiple deals.
Ready to Fund an Earnest Money Deposit?
If you have a signed contract and need EMD funding:
👉 Submit an EMD Funding Request
We’ll review the contract and help you move forward smoothly.
FAQs
How fast can EMD funding be placed?
Often within 24–48 hours after approval.
Who holds the EMD funds?
A title company or closing attorney.
Is EMD funding a loan?
It is transactional funding, not a long-term loan.