I am a new Wholesaler Investor. I am currently in process of doing my very first deal. (Nothing is under Contract yet…) I have used a Realtor to locate distressed properties to flip. I am constantly finding good property leads, but all have been Bank/REO Foreclosures. I am finding them cheaply, but I have gotten stuck because BANKS do not allow Contract Assignments. I am now forced to do a DOUBLE CLOSING, but I do not know exactly HOW to do this. I inquired of a DOUBLE CLOSING to the prospective Title Agency that the Seller is making me use, and she made some comments about me having to have my OWN MONEY upfront to DOUBLE CLOSE, and then perhaps get reimbursed from my “Investor-Buyer”. This has completely scared me because I do not have the money to buy this Bank/REO Foreclosure. Should I get a HARD MONEY LENDER to loan me the money for “1 day” to have my OWN funds at the double closing? Or should I just WALK AWAY from the deal altogether? I really didn’t want to go through the trouble of applying for a HARD MONEY LOAN for “1 day”. Of course, I would much rather do an Assignment, but Banks don’t allow them; but I keep finding good deals with PROFITABLE numbers in my wholesale-buying formula that are all Bank/REOs. Is there a step I’m leaving out of the DOUBLE CLOSING process when advising the Title Agent of the deal? Please Help. I need some advice.
Different title companies have different rules and protocols. The problem with REO’s is that the bank usually prescribes the title company even though RESPA (title agency laws) states that the buyer has the choice in that matter. I have double closed a HUD REO before, but I had documentation of my own financing, and it was at an investor friendly title company.
If you are planning on making a career out of wholesaling, I would HIGHLY recommend you develop relationships with hard money lenders or other quick closing lenders. You will use them, and you should start building those relationships now.
If hard money for one day will make you money then do what you need to do.
Thank You, Ryan!
I will do EXACTLY what you recommended.