Is the wholesaler or investor/buyer responsible for getting a Title Company for the deal? If the investor/buyer is responsible, should I suggest to them to have their title company do a double closing? Or do I need to independently get my own title company for the double closing? (I’m a new investor so please bear with me on this question…thanks)
Either party can choose the title company. You will want to select a title company that is more ‘investor friendly’. Make sure they are comfortable with double closings, assignments, etc. If the rehabber has more experience and has had success w/ a particular title company you could just go with his.
Gregg
The purpose of a double closing is so that the end buyer (your buyer) doesn’t have any knowledge of what you paid for the property. Now, if they are lining up the closings, don’t you think that that defeats the purpose of a double close?
Raj
Thats true Raj. I dont know if its good or bad, but in the few deals that I have done, I have revealed the price I paid for the property anyway. I don’t think most end buyers really care how much you are making as long as you leave them a comfortable margin to make money.
gregg
Thanks Gregg975 and Roger J, I appreciate your feedback and information.
I always require that my buyers use MY title company. It is usually not a hard sell, my title company has already done the title search, whereas they would have to wait for their company to do the search before they closed. If I have a deal, then I have the royal flush and control the transaction. If they won’t close at my title company the ten guys standing in line behind them will close at my title company.
There are 2 types of people to wholesale to, I ask them right upfront when I am adding them to my buyers list, there are alot who will get angry even if you sell them a property thats worth a 100k for 20k, if you bought it for 10k, then there are those like myself who could care less what you are paying, as long as they are making money.
I have to admit, in some ways, I like the double closing better, b/c I’m in more control & I don’t have to tell people what I’m buying the property for. With the double closing, I require 1% earnest $ minimum, & I pick the Title Company. If the buyer defaults, I keep his/her earnest $ & I start all over. I also require the buyer to pay all closing costs.
Thanks everyone, your feedback is very, very helpful to me. :smile