Double Closing

11 Replies

When doing a double close will the seller/ buyer find out that I'm doing a quick flip at closing? When the buyer contracts with me and does title search will they find out I just contracted it?

The seller wouldn't normally see the second closing. Certainly if they went and looked at public records later they would see what's happened.

The buyer and, more importantly, their lender will see what's happening and will see you're not on title. You need to be up front with them about what's going on.

Does Louisiana report sales prices in their public records? If so, yes, they can find this after the face. In not, they may still see it on the HUD-1. The HUD-1 would show the payoff for the flash cash loan and would show the net to you.

Teri-

Also, if you have cash buyers you can do a simultaneaous close and avoid paying lender fee's. With a double close you'll get charged flash funding fee's.

Thanks Jon, I will check on that. I'm not as much worried about buyers finding out I am more worried about sellers. Dont want to kill the deal because of being 3rd party. Do they have to show the buyer the hud-1?
Thanks Justin, The title companies I talked to so far doesnt allow simultaneous closings but I will keep calling more places.

There will be two separate sets of HUD-1's, one set for each transaction. Normally the buyer and seller both get the same thing. A summary sheet, then a "details of buyers transaction" and a "details of sellers transaction".

If its a good deal for your buyers they shouldn't begrudge you your fee. If they do, you should find some other buyers.

If the 2nd closing is done with all cash why is hud-1 needed for buyer? Isn't hud-1 having to do with loans? Sorry I dont understand the closing process as I never experienced it yet but hope to do so soon! Thanks for your replies!

This topic has been covered in about three threads now - I don't think your going to get a different answer if you keep posting it over and over.

The one common theme you seem to have is a fear of your buyers "knowing what your up to".

is there something your doing you should be ashamed or embarrassed of? Are you doing something underhanded or illegal or something in the “gray†area?

If so – stop it.

If not – then don’t worry about it. Jon is 100% correct about his comments on the buyers (Jon and I seemingly disagree a bit on the “necessity†of the HUD1)

As I said in a different thread you posted here – and as Jon stated here – if your buyers have a problem with you making money then find new buyers.

I have a funny feeling that you don’t feel right about the money your making and your projecting on the buyer. First rule in sales – whatever objection you have your buyer has….so clear up your issues with the money your making or the short amount of time your holding the property for and it won’t be a problem.

If the deal works for the end buyer at your purchase price then it doesn’t matter where that money is going or how long you held the property for. It is a win-win. If they do ask – do what I suggested in another one of your threads on this same topic – refocus them on their deal.

As a wholesaler you really need to deal with your issues first though – they are coming through loud and clear to an unbiased witness (me).

Robert, understand that I'm a newbie here and not as experienced as the rest of you. Thats why I'm asking so many questions, to learn and get advise from the experienced. I have nothing to hide or be ashamed of and definately not doing anything illegal, thats why I'm trying to learn as much as I can to make sure I do everything right and legal. I will be upfront with my "buyers" that I'm wholesaling,was just asking incase I would ever land a big deal that allows a big profit. And I am more worried that "sellers" dont want to sign a contract with a 3rd prty and kill the deal. I would rather let them(seller) know that I'm an investor and do a double close but not let them know I'm a 3rd party. Thats funny you would come at me like that when "you do it all the time", what is your reason for being so discreet? Not being rude just wondering how u can be so neg. when u do it ur self.

Hey Teri –

Please forgive me if I have offended you – that was not my intention. Here was my point(s).

1. I have no issues that you have asked a lot of questions – you didn’t’ really read that right – this (and many other forums) are a GRAET place to ask hundreds and thousands of questions – ask away.
2. You have asked the SAME question in 3-4 different threads about the HUD 1 â€" my point to you is that isn’t necessary at this forum (or any for that matter) â€" my feeling is your not going to get a different answer if you keep asking the same question in 3-4 different threads over the period of 24 hours. Instead â€" create and use 1 thread for that topic â€" but to keep asking about it all over the place isn’t helpful for those who come behind you and are searching. For other newbie’s it is much more polite to have it all in one thread so they can learn as you are.
3. I am not saying I know what is going on for you but it is clear that something is going on for you as you are really worried about how the buyer will react to you making money – or the amount of money – or how long you have owned the home or – or - or (re-read all your questions in the threads over the past 24 hours) – you have some block that is creating those fears and worries. I get it – not only is there not anything wrong with that it is 100% normal. I was the same way – I remember my first few deals and was scared as heck to have the buyers find out how much I made for how long I owned it and how little I did to the house – quite frankly – I will admit that was an assumption on my part and if I am off base – my humble apologies. However - If you don’t have ANY of that going on – then I really don’t get the purpose of 1 thread (let along several) asking about hiding your profits and short time of ownership. So – that wasn’t me being rude I was actually trying to help you see where the objections might be coming from.
4. Why do I hide it today? It isn’t for my needs that is for sure - I work with many “referrers†across the county – people I pay on the HUD who provide me with buyers – they ask me to “hide†their referral fee – because they provide me with some buyers – I do it – I don’t care. For deals I do with my own buyers no matter if they are other investors or home buyers or seniors on reverse mortgages I will be honest and say I am not sure what they see – I think the title company I use only provides the sellers statement out of habit because of the volume I did several years ago with a the referrers. But after the first year of being in business I learned the value of the service I provide – I learned that making the $$ I make is okay – that holding a property for a few weeks and making big bucks is okay – but hey – those were my objections and not yours. Today – it doesn’t really matter to me what people see – if they question it – I do just what I told you to do – refocus them on their deal – on their money – that the deal works for them – that works in 100% of the cases for those who do see or ask about my $$ or how I make $$.
5. I understand my tone of typing and my approach to things is not for everyone – I tell the truth how I see it – you chose to take that as me being negative when it was meant in only a very positive way. For me – the quicker I get out of my way and deal with my stuff the quicker I get deals done. The more I worry and focus on what a “buyer might think†the slower it goes.
6. Perfect example â€" bought a duplex from a bank in Melvindale Michigan â€" quit claim deed â€" no warranty deed â€" no closing â€" just deeded the property over for some cash. I found out later that this city requires the buyer (both me and the person I sell it to) to put up a $10,000 bond with the city until the repairs are made. I am not repairing this home â€" just wholesaling it. When I found this out I was like OH MY GOD who is going to buy this â€" I HAD OBJECTIONS WITH IT! Because of that so did everyone I talked to â€" the day I realized what was going on â€" this was my stuff not theirs I handled my own objections and within 24 hours had 2 buyers. This was this past month â€" like I said â€" getting out of my own way is key for me â€" you may not have that going on â€" awesome.
7. If your buyers are objecting to your profit or the length of time you have owned the home then do as the other person in this thread suggested – find a better buyer. You shouldn’t count their money and they shouldn’t count yours.

So again – my humble apologies my tone and assumptions offended you – I was really trying to help you through this situation and clearly I am not the one to do it!

EDIT: Re-read your first post in this thread and your last post to me - in one you say your worried about them finding out you did a quick flip and the other you say I am more worried that "sellers" dont want to sign a contract with a 3rd prty and kill the deal.

In other threads you have posted comments about being worried about them finding out how much $$ your making or the length of time you owned it or both.

You can call me rude and negative but you seem to be the one with this objection as you have not talked about anyone else bringing it up.

Again - this is normal - your not weird or odd or anything - your right where you should be in my opinion.

So again – my humble apologies my tone and assumptions offended you – I was really trying to help you through this situation and clearly I am not the one to do it!

Thanks for your input. It's basically just newbie jitters!! I just dont want to run into any problems or mistakes when I get started, trying to prevent them if possible! This is my dream goal and will be in it for the long haul so I want to make sure of everything, preventing mistakes if possible so I can have a great reputation. This is a great site and really appreciate everyone answering my questions! I am feeling more and more confident everyday!

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here