Double Closing VS. Assigning Contracts

2 Replies

Hello, I have a question that I need classify on. Can someone explain the difference to mean in wholesaling with a double closing versus an assignment. I’m under the impression that I’m a double closing that you would need funds upfront to cover the cost of buying the property from the seller then going back to the end buyer and finishing that contract and that’s where you would make your profit. As with an assignment you, seller and buyer basically close altogether during the closing process. I just want to know the difference and whether one is better than the other?

@Jonne Washington

This is a question I get asked a lot. :)

With Assignment, you never close on the deal yourself. You put the property under contract and assign it (via an Assignment Agreement) to another end buyer, who will proceed to the closing, fund the deal, etc. You will be paid an Assignment Fee at closing (from the title company, if you set it up correctly.) So you basically relinquish your contract to someone else for a fee.

With double closings, you actually close on the deal and own the property for at least a few minutes, before selling it to an end buyer. It's an A to B, B to C transaction, you being the B part. :)

As far as the funds for double closing, you can use Transactional Funding or the end buyer's funds, if the title company or closing attorney allows it (it takes a little bit of research, but there are still a lot of title companies who will work with you on that.)

I personally do assignments if the profit/spread is only a few thousand dollars and double closings when the profit spread is over $10k. The reason being that the end buyer with an assignment would see your profit (the assignment fee) and might object to paying a large amount, so I avoid the risk by doing a double closing instead.

Thank you Laura 😊,I was actually replaying your webinar “Fast Track Real Estate Wholesaling” and this question had came about. This was very interesting to me and I learned a great deal. I have a clear understanding now of the difference and I see why certain deals would be better under double closings.I was always scared to try a double closing with getting started I just wanted to assign contracts. But you have made it more clear to me and I actually want to try it now. Thank you for breaking it down in more depth for me.