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Updated about 9 years ago on . Most recent reply

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Ken Adkins
  • Wholesaler
  • Raleigh, NC
0
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11
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How to do a double closing in a DRY state as a Wholesaler??

Ken Adkins
  • Wholesaler
  • Raleigh, NC
Posted

Hello BP,

I'm a wholesaler in NC and have a deal that I want to do a double closing on without bringing any money to closing. I spoke to one attorney that said that's not possible in a Dry state but I know this happens all the time. Any advise would be great!

Ken

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Ted Akers
  • Centennial, CO
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Ted Akers
  • Centennial, CO
Replied

Hello @Ken Adkins,

The distinction between "wet" and "dry" funding generally applies to transactions involving a mortgage, so may not be a relevant distinction unless your end buyer is using a mortgage.  Dry funding generally means that funds do not transfer immediately at signing of the closing documents. Transactional funders are typically looking for your end buyer to be using cash for their purchase.  Is your end buyer a cash buyer or are they funding with a mortgage?

The easiest way to think about it is that title companies (or your closing attorney) want to see "separate" funds for both transactions.  As Don mentioned, the old days of "simultaneous" closings using your end buyers funds are generally gone (whether in a wet or dry state); because title wants to see two distinct transactions that are separately and independently funded.  I am a transactional funder that has funded in dry states.  If your end buyer is a cash buyer a "back-to-back" transactional funding can be accomplished with a slightly different time frame for when the recording and transfer of title takes place.  If your end buyer is using a mortgage that is a different issue, as most mortgage companies will require 90 days of "title seasoning".  Thus, you cannot transfer title to the end buyer until you have owned the property for 90 days.  If that is the case transactional funding can be used but is usually not a real viable option due to fees (they are high due to funding at or close to 100% of your purchase, rather than 65% for most hard money deals).

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