Updated almost 6 years ago on . Most recent reply
Wholesaling Newbie Here
I was the winning bidder for a property at auction recently. The property is located in Gorham Maine which is a desirable town in my area. I could keep it, rehab it and refi or flip it but I have 6 other projects I’m managing currently. I’ve never wholesaled a property but I would like to wholesale this one. Not really sure where to go from here. I was thinking of advertising it on Craigslist to kind of pre-sell it before I actually close on it in about a month but if I get someone that is interested, do I sell the contract? If so, how? Or do I line up a double closing? And how does a double closing actually work?
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@Andrew Earle I would start marketing it right away. I have never used Craig's list but I would go to local REIAs and Meetups and talk it up to investors I know.
One option is to assign the contract. Basically you are selling the contract. You have a contract for the sale of your first contract. There is lots of information here on wholesaling.
Most contracts say they are not assignable. Depending on the terms of the auction and the auction contract you may have to double close. You can use your own money to close and then immediately close on the second transaction.
Another alternative is, some hard money lenders will finance a transaction like this for a few points of the purchase price. There is a term for this type of financing but is slips my mind now. They are basically loaning you the money for an hour.
In rare cases a title company may use the end buyers funds to fund the first purchase to put it into your name. Then immediately do the second transaction.