Introduction
For wholesalers, waiting on a closing to collect your assignment fee can slow down momentum, limit marketing budgets, and delay locking up new deals. But what if you could tap into that fee sooner—without taking on risky debt?
That’s the idea behind assignment fee advances, a short-term, deal-based funding tool. When structured properly, they are secured by the end buyer’s Earnest Money Deposit (EMD) and repaid at closing before the wholesaler receives their final payout.
This article explains how EMD-backed advances work, how they’re protected, and why they’re a low-risk, high-leverage cash flow strategy.
What Is an Assignment Fee Advance Secured by EMD?
An assignment fee advance allows you to receive a portion of your wholesale fee upfront, once your end buyer deposits their Earnest Money Deposit (EMD). The capital is protected because:
- The advance is never more than the EMD collected, and
- You assign the rights to the EMD refund to the funder in case the buyer defaults.
This means the advance is backed by real money held in escrow, not by your credit score.
📌 Investopedia defines EMDs as good-faith deposits, but in this structure, they also act as short-term security for funding advances.
How Protection Works: The EMD & Refund Rights
In every assignment fee advance we provide:
- We confirm EMD is deposited and verifiable in escrow.
- We fund a portion of your assignment fee—up to the total amount of that EMD.
- You assign us the rights to the EMD refund in the event your buyer fails to perform.
- At closing, our funding + fee is repaid first from the assignment fee. You get the balance.
This ensures we’re never overexposed, and you don’t owe anything out of pocket—even if the deal falls through.
📌 BiggerPockets emphasizes that the EMD is one of the strongest indicators that a deal will close—and a critical milestone for accessing working capital early.
Funding & Repayment Flow: Step-by-Step
Here’s how a secure advance works in practice:
- You assign your contract to a vetted buyer.
- The buyer deposits their EMD into escrow.
- You request an assignment fee advance—up to the full amount of the EMD.
- We confirm the EMD is in escrow and execute documents assigning EMD refund rights.
- You receive a portion of your fee before closing.
- At closing, we are repaid our original funding amount plus our agreed fee, and you receive your remaining assignment fee.
Why Wholesalers Use This Strategy
✅ Quick access to working capital (24–48 hrs after EMD deposit)
✅ No risk of owing out-of-pocket if the buyer fails to close
✅ Not a loan—no personal guarantee, no long-term interest
✅ Scales with deal volume
✅ Perfect for funding marketing, operations, or your next acquisition
📌 The Close notes that scaling as a wholesaler requires liquidity, and EMD-backed advances provide that without long-term financing headaches.
Best Practices for Structuring Your Deal
- 🔹 Always use a reputable title company or closing attorney to hold the EMD.
- 🔹 Ensure your assignment agreement documents the assignment fee clearly.
- 🔹 Work with end buyers who deposit EMDs early and consistently perform.
- 🔹 Ask your funder what documentation they’ll need to verify the EMD and structure the refund assignment.
📌 Need a contract template? LegalTemplates provides simple assignment forms you can customize.
Final Thoughts: Secure Capital. Keep Closing.
If you’re wholesaling real estate and need access to capital before closing, an assignment fee advance backed by your buyer’s EMD is one of the safest ways to do it. You don’t risk your own cash. You don’t owe if the deal falls through. And your advance is fully repaid at closing, before your remaining fee is released.
🚀 Got a deal under contract and EMD in escrow? Let’s get you paid now.
👉 [Apply for an Assignment Fee Advance ]