Simltaneous Closing REO'S
I've heard about simultaneous closings for reo properties.
Has anyone had any success with this strategy.
And if you have how do you go about structuring this sort of transaction?
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When you say "simultaneous closings" what exactly do you mean?
Generally, there are two types of closings that you may be referring to:
1. Back-to-Back Closings: This is where you close on your side of the transactions and then several hours (or a day or two) later you close on the transaction with your end-buyer. This requires you to have your funds to close the first half of the transaction, and you actually take ownership for a short period of time.
2. Simultaneous Closing: This is where both closings take place at the same table, and your end-buyer actually funds the purchase of the property. In other words, you don't need to come to the table with any funds, and you never really take ownership of the property.
Now, #2 doesn't really exist anymore -- at least, I haven't heard any investors on this site (or personally) claim to have done it or claim to know of any closing attorneys who can get this done in any state. If it can be done these days, it's very, very rare.
As for #1, this isn't too uncommon, and I imagine you can find a closing attorney (or escrow company) in any area that would be willing to do this.
As for doing it with REOs, there's no reason why you can't. The only restriction will be when the seller of the REO puts a deed restriction on the property that restricts your ability to do this. For example, Fannie Mae generally restricts their REO buyers from reselling a property for more than a 20% profit for at least 90 days. So, while you could do a back-to-back closing on a FNMA REO, it would have to be for less than 20% above your purchase price.
Other than those types of restrictions, there is no reason you wouldn't be able to to a back-to-back close on a typical REO.