Those who are new to the wonderful world of real estate often think that there’s only one kind of real estate transaction. That is, they think all deals are between a seller and a buyer. The truth, however, is that there are other kinds of real estate deals, and some involve multiple parties, such as a double closing.
To know more about what double closing is and how real estate professionals profit from this, read on!
Double Closing: What Is It?
In a double close scenario, a real estate investor closes two separate real estate transactions concurrently. One is with the property seller and the other is with the end buyer. Usually, double closing happens quickly, and once the deals are complete the investor walks away with their profit.
How Can In Investor Fund A Double Closing?
Unfortunately, finding a lender who provides funding for double closing scenarios can be difficult sometimes. That said, there are other options you can pursue when you need funding for a double closing, including:
- Using transactional funding (flash funds)
- Single-source financing
What’s The Process In A Double Closing Scenario?
Essentially, the real estate investor is acting as a middleman. They purchase a home from one party and sell it to another. Since double closing can be complicated, the investors who do these deals need to be organized, familiar with real estate market comps, transparent, and willing to work with professional title businesses.
So why does double closing happen? For one, if an investor spots a property that’s undervalued, they can scoop it up and sell it to another party at a more realistic valuation and pocket the difference. It’s a case of the early bird catching the worm, really.
Is Double Closing Legal?
Every state has laws and regulations governing double closing. Some are stricter than others when it comes to this practice. Investors who want to stay up to date on the most recent laws and regulation should keep in touch with a qualified local real estate attorney.
To Sum Up
Whether you’re new to the real estate business or a seasoned veteran, you can benefit from doing double closings. This kind of transaction is ideal for those who are looking to make a quick deal happen. And if you don’t mind holding a property for months and months, you could always try flipping.
Do you require funding to do wholesale real estate transactions in your city? DoubleClose.Com provides transactional funding for wholesale real estate double closings. Get funding fast with no upfront costs!