Investor · Austin TX · Member since 2016 · 1k+ posts · 2k+ votes
7y
@Ben Gabin You will sign a contract with the wholesaler for the property, a double closing just means that the wholesaler has a contract with the seller that they will close on and then they will sell the property to you. You should be able to take that contract to your hard money lender just like any other deal.
Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
7y
Originally posted by @Account Closed:
Say I’m buying a deal from a wholesaler who wants to double close rather than assign.
Am I going to be able to get a loan even though I’m not on the contract?
You will be on someone's contract. If it is a "true" deal HML will lend, however you may need transactional funding depending on how it is being handled.
By the way, the reason the wholesaler wants a double close is because he is making a ton of money and he doesn't want you or the seller to know how much.
Lender · Troy, MI · Member since 2019 · 432 posts · 147 votes
7y
@Account Closed
You can do assignment of contract usually when the profit is about $5000 range or less OR profit is 5% less for larger size deals.
When the profit is over $10,000 OR over 5%; the end buyer or seller is not happy in many cases. The safer bet is go with transactional funding.
Lenders can do 100% funds for A>B and B>C double closing; as this happens on same day with same title company. Usually the end buyer C has to be cash buyer.
Investor/Agent · Kansas City, MO · Member since 2017 · 291 posts · 308 votes
7y
@Account Closed if you are buying the deal from the wholesaler then you will be the buyer on a contract and he/she will be the seller. The wholesaler will also have a separate contract with the current homeowner. They will have to either buy in cash or use transactional funding. You can use whatever loan product you want, assuming you close on the day the wholesaler needs you to close. The title company or attorney should be able to help significantly with this.
Investor · Austin TX · Member since 2016 · 1k+ posts · 2k+ votes
7y
@Ben Gabin You will sign a contract with the wholesaler for the property, a double closing just means that the wholesaler has a contract with the seller that they will close on and then they will sell the property to you. You should be able to take that contract to your hard money lender just like any other deal.
Lender · Arlington, TX · Member since 2018 · 465 posts · 184 votes
7y
Originally posted by @Account Closed:
Say I’m buying a deal from a wholesaler who wants to double close rather than assign.
Am I going to be able to get a loan even though I’m not on the contract?
Others have answered this well, let me just add, you will most likely need an LLC to close with hard money and the loan will close in name of LLC. That is how HML usually works, I'm not sure if it is different for transactional loan on double close.
New Caney, TX · Member since 2018 · 17 posts · 3 votes
7y
Q: SO let's just say I'm walking into a double closure deal tomorrow morning as Ben Gabin/the buyer, aren't the funds due tomorrow? So is that when I feel like I should already have the funds ready or a pre-approval if someone can shed some light here;) Thx
Investor/Agent · Kansas City, MO · Member since 2017 · 291 posts · 308 votes
7y
@Glen Thomas Corder if you are walking in as the end buyer then yes the funds are due tomorrow. Actually, regardless if you are in the middle or the end buyer the funds are due. The wholesaler in the middle uses the transactional funding as it's just for a day. He/she uses to buy the first deal and the end buyers funding is used to buy it from the wholesaler.
Lender · Denver, CO · Member since 2017 · 348 posts · 143 votes
7y
Yes because you will be on the 2nd contract of the double close. They will close the deal with the seller then they will become the seller and need to have a contract with you to sell it to you for the second closing. So you should not have a problem getting funded.