Transactional loans for Virginia wholesale?

[Kenny Lewis]

Need some advice/info from fellow Virginia wholesalers...I am under the impression that to assign a contract to the end buyer I need to have a transactional loan to close the deal. Is that correct? If so, how do transactional loans work and what do I need to do in order to close. (I say transactional loan because I don't have the funds to close on my own right now)

Thanks

[Duane Ortega]

@Kenny Lewis

@Kenny LewisNo, it is not a law, and most of the time, it is not needed if you have a cash buyer.  However, if you have a huge profit or markup, some C buyers will raise an eyebrow and may give you a hard time.  Common terms in the transactional funding industry:  A=seller, B=investor/you, C=end buyer.  This is another common reason for large-profit wholesale transactions to use transactional funding.  Transactional funding requires 2 closings, and therefore you don't have to disclose to your C buyer how much you paid the A seller.  However, anyone, including A and C buyers can find out how much you paid for what after the closings via the county recorder's office.  C buyers, in theory, should not mind how much you as the B investor make, but in some cases, that is not reality.

Hope this helps,

Duane.