Looking to double close

Foreclosures, Short Sales, Tax Foreclosures
1

I have not done a double close to complete a shortsale yet, but thinking I might need to complete one on my next ss deal. Couple questions relating to double closings and ss are…

  1. Does the bank ever know that I conducted a double closing? If so, I imagine this would be a problem, and how can I get around it?

  2. I remember reading a thread awhile back that said the second buyer would need to put down earnest money down to complete the double closing, is this correct information?

  3. I assume it depends on my competence and the competence of my title security officer, but are these double closings difficult(a bit vague I know, but I am curious to see the success of others)?

Thanks.

Gregg, Tucson, AZ

2

Good Morning,
Your question:1) Does the bank ever know that I conducted a double closing? If so, I imagine this would be a problem, and how can I get around it?
I have one Title Co that does not require notifing the bank, The other says they have to. So with them I assign. Not all my offers get accepted with and/or assigns so I double w/Company # 1

Your Question 2) I remember reading a thread awhile back that said the second buyer would need to put down earnest money down to complete the double closing, is this correct information?
I write my offers w/earnest due at closing, and require all my buyers to deposit and In some cases release the money prior to close. The E. money needs to be deposited regardless of a double close, it is not required to perform one.Your buyers must follow the EM agreement in which you accepted which means earnest money within x days and closing by x date.

Yes it does depend on you and your teams competence. Some Title co’s haven’t got what it takes and need to be trained .
Thanks for your time, Darin

3

Thanks for the input Darin

I was kind of curious…For shortsales, you said that the banks that wont accept and/or assigns, you double close. So, your approach is to attempt to and/or assign your ss deals at first, and if the bank says no, you go ahead and do the double close?

Gregg

4

Yes Gregg
And or assigns cost me less. My name stays off all county records, not that I’m wanted for any thing but…its cheaper and less paper work for title team members.
Thanks, Darin

5

Darin, what lenders allow you to use “and/or assigns” language on the P&S contract? I have done double closings on short sales, however I heard that lenders would not accept the “and/or assigns”.

I would love to try this, but I first I want to know WHICH lenders actually accept this language.
Thanks

6

I know that Countrywide does NOT allow it. I have an assignable contract, and I just had a SS approved with them, and in the payoff letter it specifically states both my company name as buyer, AND that the sale cannot be assigned.

7

Gregg,

    More important then a Title Comapany that will allow it or a Lender that you short sale knowing about it is...

Will the end buyers lender allow them to buy a house with no title seasoning. That is the main issue and yes there are ways around this as well.

8

  1. Based on the Title Company I use, a double closing is none of the bank’s business.

  2. When I do double closings, I always require my buyer to put down earnest $, typically 1% of the purchase price. Earnest $ is b/w me the Seller & my Buyer.

  3. Double closings are easy, if you use an investor friendly Title Company that does them. You have a contract to buy the house via SS, your buyer has a contract to buy the house from you, your buyer provides all the cash for the transaction; then the Title Company pays you the left overs.

Where things get complicated is if your buyer’s financing has seasoning issues. You need to find this out ahead of time. You may want to have some mortgage brokers on your team that can find financing w/o seasoning issues just in case this happens.