How to Close REO Wholesale Deals (Part 1 of 5)

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If you’re a wholesaler and have been considering jumping into the REO arena, you’ve probably already figured out that you’re not going to be able to assign your purchase contract to your end buyer like you would on a regular wholesale deal. Ninety-nine percent of the banks will include a “No-Assignment” clause in their contract which will prevent you from doing so.

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REO Wholesales are Still Possible!

Because of the bank’s restriction on assigning contracts, many wholesalers are under the impression that there is no way to wholesale these deals at all. This is far from the truth, and while there may be a few more hoops to jump through when wholesaling REO properties, there are still several ways to get these deals to the closing table.

Over the next five weeks, I will be covering five different strategies that you can use to wholesale your REO deals and get around the bank’s “No- Assignment” clause.

Conducting a Simultaneous Closing

Today I will be talking about using a simultaneous closing, which is the way I have been closing my REO wholesale deals for the last two years.

When a simultaneous closing occurs, there are two separate transactions taking place, often referred to as the A-B transaction, and the B-C transaction. The A-B sale refers to the transaction between the wholesaler and the bank, and the B-C sale refers to the transaction between the wholesaler and their end buyer. When doing a simultaneous closing, the end buyer’s funds are used to fund both the A-B sale as well as the B-C sale, so as a wholesaler, you are not required to bring any cash to the closing table.

Because the banks will stipulate in their addendum that the title work for the A-B sale be done at their title company, you will need to coordinate that closing with your title company, who will handle the title work for the B-C sale.

Once the bank’s title company has all of the closing documents prepared for the A-B sale, you can request that they be sent to your title company where you will be signing all of the documents for both transactions.

The closing for both deals will be held at your title company, and once all of the documents are signed and both deals are funded, your title company will wire the funds for the A-B sale to the bank’s title company and Fed Ex them the signed closing documents.

In order to close your REO wholesale deals in this manner, your end buyer will need to be paying cash, or using a hard money lender who will have no problem with the fact that the property is being flipped on the same day it is purchased from the bank. You will also need an investor-friendly title company on your side who is familiar with simultaneous closings.

If you are unable to find a title company in your area who will perform a simultaneous closing, don’t worry- there are four other methods you can use to get your REO wholesale deals to the closing table. I will be going over each one of those methods in the coming weeks, so stay tuned..

About Author

Formerly a bartender, Steph Davis is now a full time wholesaler in Tampa, FL. If you'd like to get an idea of what it's really like out there in the trenches, head on over to her blog:!


  1. I love this strategy and it works very well. You need to be carefull because state laws can vary. For example, in Utah you need to bring separate funds for each close. Legitimate title companies will not do what you describe. Solution: overnight funds from a hard money lender.

  2. Hi David,

    There are many title companies in my area who will not do them either, but not because they violate any laws..

    The one I use is owned and operated by two well respected attorneys. There are several others in my area who will do simul closes also, all of which are reputable title companies.

    Everything is done above board, and there is complete disclosure to the buyer that their funds are being used for both transactions. The underwriter requires that they sign a document saying that they know what is going on.


    • Stephen tangwa on

      Hi Steph i really love sisimultaneous closing the way escribe it. My question is whether i Will to let the end buyer know what i will make out of this deal since they are supplying the funds for both closings. Or rather can the end buyer demand to know how much the wholesaler is getting from the transaction? How do you handle this?

  3. Steph:

    Great strategy to use a second title company to handle the 2nd closing, but let them close first! They have to wait until the first title company records, though, correct?

    Am I correct that this probably won’t work if the end buyer brings in a new loan (except maybe hard money)?


  4. Hi Thomas,

    Yes, they can’t record the second deed until the first title company records theirs. This causes problems somtimes because the banks title companies SUCK and sometimes take forever to record their deed..

    Yes, you are correct, this will only work with cash or hard money deals..


  5. The title company handling the courtesy close is only getting the docs signed for the A-B sale. Once those are executed, they FedEx them back to the bank’s title co, and the bank’s title co is responsible for recording the deed for the A-B.

    My title co won’t do a simul for a short sale, just for REO deals. My attorney’s explanation is that when doing a simul close for an REO, the bank is being represented by their own title co, therefore, my title co has no fiduciary responsibility to the bank and is not required to disclose the details of the transaction.

    If you can’t find a title co who will do a simul close, you can always do a double instead and use transactional funding. Just make sure to account for the added fees when you make your offers.

    Easy, Peasey, Japanesey.


  6. I thought you tell the listing agent to have the closing docs emailed to you and have your title company do a courtesy closing for them and close your deal. So wouldnt your title company be doing the 1st and second deed?

    I found a company that ONLY closes on shortsales and REO’s with investors and end buyers. The guy said you have to let the lender know whats going on otherwise it becomes fruad. Now i think that may just be with shortsales. He sent me a document from Freddie Mac or Fannie Mae about it. I thought it would make it harder to do the deal but he says no. any ideas? He’s out of state from me but they close nation wide

  7. Hi Sam,

    I hate to say there aren’t any, but I haven’t come across anyone yet from CA who has been able to find a title co who will do a simultaneous closing.

    You will most likely have to use one of the other closing strategies that I talk about in the other articles..


  8. Hi Steph,
    How do you handle the double set of closing cost in a back to back or in a doubleclosing. I’m in PA and only the transfer tax here is 3%? for instance in a $100,000 you will have to pay $3000 0n the first transaction and if you sold it for $ 115,000.00 you will have to pay another $3450, that is$ 6,450 just in transfer tax only?????
    I’m a short sale investor and what I do is I negotiate with the lender(Bank) that they will pay all closing cost but title insurance and I never purchase a title insurance anyways because I hold it just for a few min.So No Closing on A-B to me

  9. Hi Giocco,

    I always sell my deals at a net price to me, which means
    that my buyer pays all closing costs on the B-C transaction.
    Most of my deals are in the 40k and under price range, so
    it usually ends up costing the end buyer around 1k (give or take)
    in closing fees.

    On the A-B side, the bank usually pays the majority of the closing
    costs (title insurance, transfer tax, etc), so I usually only end up
    having to pay around $500-$600 (give or take) in closing fees for
    both transactions.

    If you’re in an area where closing fess are much higher, you might consider
    looking into using a land trust or LLC to wholesale your deals. Either that,
    or you just have to make sure to take those fees into consideration when you’re
    making your offers, ie: make them lower.

    Hope that helps,

  10. Well, having to say real estate transaction deals are always complicated and taking forever to finalizing and closing a deal, sometime that creates a lot of anxiety and panic attact to walk out. Now I am doing my real estate business deals in different way like buying the real estate notes instead to get your way out faster.

  11. with the a-b sale dos’nt the bank want proof of funds first and would the banl okay the deal
    if the title company told them that they where going to close the b to c deal first or does the bank even have to know this also if the title company knows that the bank for a-b does not do double closing will they say so

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