Is a double closing possible?

13 Replies

I submitted an offer on a property which was accepted. After inspection I decided I didn't want to proceed with the deal. One of my best friends inspected the property and said he wants to buy it. The contract says I can't assign the sale. What methods can I undertake for my friend to buy the house instead of me? I'm of course not making any profit here. Can I do a double closing and can anyone explain the finer details to me?

You can do a double closing as that's not an assignment. What type of a deal is this? Off market? MLS? Hud? Is our friend paying cash?

If it's just a regular residential deal I would ask the seller for an amendment allowing assignment. I would explain that when you completed your inspection there are issues that came up that you can't handle. So instead of backing out of your contract you want to allow a friend to close on it instead. They should be more than okay with that. 

If not you are paying closing costs on your double close.

Yes you can have a double closing or what I've always referred to as a double clutch.

If you can't assign as @Ryan Dossey suggested then you'll need to either be ready wiling and able to close all cash or find a transaction lender for the closing.

Keep in mind you will have cost in the closing so youmight want to let your friends know those costs will be passed on to them and recovered through the closing. That's assuming you're not intending to pay the costs on behalf of your friend.

I assume it's an REO, so no assignment. A double close will require funding for your purchase, in addition to funding from your end buyer. Even in south FL, none of the title co.s will allow using the end buyer's funding to close your initial purchase. If a REO, and you elected to use the bank's title co., you'll likely need a separate title co. for the second transfer.

In MO and INDY title companies will let you double close and use the end buyers funds to close the deal. So ask/look around for an investor friendly title co and ask. 

Thank you for all the responses. It's an REO from the MLS. I already asked the agent if I could assign the contract and he said no, so that's not an option.
The title agency just told me I cannot do a double close as the bank doesn't allow it. It seems my only option is to buy and resell?
Originally posted by @Ryan Dossey :

In MO and INDY title companies will let you double close and use the end buyers funds to close the deal. So ask/look around for an investor friendly title co and ask. 

 Ryan, what title company do you use here in Indy? I am looking for a couple investor friendly companies I can depend on. 

@Nat Chan

For you to buy and resell is a form of double closing, it is just supposed to happen all at the same time. Also trying to wholesale homes from the MLS is usually going to be difficult if impossible. Too much red tape, agents, etc....

FYI- possible reason that you were told that you cannot double close is because it is from REO and you may have a clause stating that you must wait a specific time frame (31 or 91) days; however assuming that you are buying all cash (yours/private or hard) draw up a land trust where then you can name the beneficiary as the end result owner. You may as the trustee name the beneficiary. This is possible in Florida and it is a simple document that you can draw up yourself. As always check with legal counsel.

Up yourself. This will facilitate one closing. You may also utilize an LLC as the owner of the property. Then you can sell the LLC that holds the property. Read up on the Illinois land trust to become familiar with this subject. As always check with legal counsel. Best wishes.

Originally posted by @Nat Chan :
The title agency just told me I cannot do a double close as the bank doesn't allow it. It seems my only option is to buy and resell?

 Why don't you go ahead and buy the property from the bank using your friends money than just deed the property to your friend?

Originally posted by @Nat Chan :
The title agency just told me I cannot do a double close as the bank doesn't allow it. It seems my only option is to buy and resell?

 The only reason, the title company is saying that the bank doesn't allow it is because you are dealing with the banks title company.  You can require that you use your title company for your half of the closing and than do the double close from your side.

My only thought was since you weren't making anything, just close it with your friends money then special warranty deed it to your friend.  (Don't quit claim it because if you do, you'll void the title insurance)

@Nat Chan I would make sure your friend is absolutely on-board with him BUYING the property AS-IS AND whatever decision you make for closing (double clutch, buy and resell). You can add a little extra on top to get something out of it for your trouble. Be up front and tell your friend this. You are taking risks buying something you don't want to buy.

Also, he would need to make up for what you spent on closing, so add that to the asking price. You don't have to inform your friend, unless he asks, or unless you want to.

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