:hammer Hi! I’m a new Flipper & I have come across a problem. I have just about sewn up a great deal (REO from a Bank), however, the Bank somehow heard about my wanting to do a double close with an Investor and now the Bank got scared and does NOT want to complete the deal.
Any thoughts on how we could convince the Bank that the double close is leagal & ok so that we could pull the deal out of the ditch?
If anyone has any ideas, please feel free to call me any time at (512)358-8897. I would really appreciate it.
Thx, Audrey
Audrey,
I need more information. Do you have a fully signed contract? I’m assuming you don’t. If you did they couldn’t back out. Remember, sellers have to sell, buyers don’t have to buy…after you have a fully signed contract of course.
You don’t need to convince the bank that double closings are legal. They know that.
Banks get burned by newbies all the time. Newbies tie up a property hoping to flip it and then back out on the bank at the last minute when they can’t get it flipped. It’s easy to understand where the bank is coming from. They want to sell to someone who has the money to close.
Why are you attempting a double close? Just assign the contract. In my opinion assignments are much easier. Keep it simple.
They bank may have already blacklisted whatever name you put on the contract. They probably won’t accept another contract under that name. If you have an entity you can resubmit a new contract under the entities name or vice versa. If you have a partner submit a new offer under their name. Make it look like it’s a totally new offer from a new buyer.
Now that the bank knows your intentions they may try to renegotiate the earnest money. They might ask you to put up double what they originally wanted. That way they get some money if your buyer backs out. You better be certain your buyer can close if you do that. If your buyer walks and you don’t close you can kiss your earnest money goodbye. Banks don’t mess around.
Not that it matters at this point, but how did the bank find out about your intentions to do a double close? Loose lips sink ships.
Good luck.