Question on A-B, B-C transaction

I’m working with the seller on a property that will be in foreclosure soon. I have an agreement with the seller to purchase the property for 150k however the seller is not going to make any profit out of that 150 at all. The Bank is willing to shortsale it for that price.
I have a list of people that want to purchase the home to live in (end buyers) for 220k. Now my question is how I can set up the contracts for the deal so that I can have my end buyer fund my 150k so how does this work? Should I put a contract in the title company to purchase for 150k and then make a contract with the end buyer for 220k and then I get to keep the 70g for myself? Would I need to use “transactional funding” for the 150k?

Doing the short sale will have less impact on the homeowners credit compared to a foreclosure, so worth the effort to help them. In your contract to the bank you want to disclose that you intend to resell the property for a profit. In your contract to your buyer you want to disclose that your have the property under contract but your ability to sell to them is contingent upon you being delivered clean title. Then yes, use Transactional Funding for the first purchase. Be aware that if your buyer needs financing they have to disclose to their lender that the property is being purchased by an investor and resold the same day. You want to focus on cash buyers or buyers using hard money. Most conventional lenders will not lend until you have owned the property 90 days. You want to direct them to portfolio lenders, community banks or credit unions. Prospect mortgage is a national company that requires one day title seasoning. Suntrust has been doing same day deals when the buyer has a larger than minimal down payment. FHA has also lifted their 90 day title seasoning requirement, although not all lenders are participating without the 90 days seasoning.

Thanks that helps a lot. I wasnt sure about the 90day seasoning. Do you know if its more difficult for a home owner to get a loan from lenders that dont require the 90day seasoning? higher interest rates, larger down payment, needing higher cred score or better borrowing history ect.?
Another concern I have is getting my @$$ sued off by the seller. Will the “distressed home owner disclosure form” protect me from profiting off the deal? Thanks

You should not see material differences with lenders that do not have title seasoning requirements. Underwriting paramaters whould be near identical. However, traditional lenders like Suntrust and Bank of America are waiving seasoning typically with 20% down payments, so that is a material consideration. Use the Owner Affadavit that is tied to the Option Contract for disclosures to the Homeowner. It is on my website under Free Forms and Downloads if you need it. That is one area, in my humble oppinion, that none of us should neglect; especially in this environment.

Ted that was all great advice, thanks. I have a similar situation in NYC so I am definitely going to check your website.

Thanks Eve,
In New York, and most other states, also try Prospect Mortgage. I have not worked with or spoke to them yet but just heard they have a one-day seasoning requirement. That may not work for same-day transactional funding but is worth a shot and could be at least extended term transactional funding rather than hard money.