Can you do a simultaneous closing w/ realtor

I may be wrong, but if you assign it to your buyer, you are pretty much out of the deal. The deal now becomes between the seller and your buyer. We don't assign, mostly buy and hold so I may be wrong. Did you put and or/assign on the offer when you presented it to the seller. PM Carol Stinson, this years contest winner, she is the guru on assignments....Jan

Yes I will put and or assigns in the contract. But the plan is to do a back to back. Or I just bring my buyer in. I have him sign an assignment contract before to solidify me getting paid. He can pay me personally up front and just close the deal. Right?

It sounds like you are trying to do an assignment and a double close all in the same deal. What route do you want to go?

With the assignment you find a seller and put their house under contract. This is the price that you and the seller negotiate. Then you go out and find a buyer for your locked up property. You make a contract with them saying that you are assigning them to your seller for a higher amount than what you negoed with the seller. (this is your assignment fee) Then you all sign the release of interest form where you are released from all responsibility from purchasing the property and you put in your assignment fee. This is where you get paid. If you do not have the release of interest/invoice signed and turned in by closing you will not be paid for your work. This is the most important piece.

The double closing is where you get a proof of funds letter and act like you are purchasing the property. Once you nego a price, the property is then locked up by you and you will then find a buyer for your property. You nego a price higher than what you negoed with the seller to make your profit and you both go into closing on the same day. The important part of this is that you need to make sure that your closing date with the bank and the buyers closing date with the bank are both the same day only separated by a couple of hours. You will close on the property first and then a couple of hours later you will go back to the bank and close with your buyer on the same property. You will need to make sure that you find a title company that will do double closings for you. Not all title companies will do this in this type of market. I have had challenges finding one that will, but if you look hard enough they are out there. If you are dealing with an REO make sure that you let the bank know that you want to use your own title company or you do not want the house. If the bank uses their own title company the deal will not work. You will also want to make sure that you DO NOT let the bank catch wind of what you are trying to do or they will dump you like a fat bag of potatoes. I have a friend at the bank that I go through and I asked her about double closings on a house and she said that it is the biggest no no and the bank will not deal with you if they know that is what your intentions are.

Please let me know if you have any other questions about this. I tried to be as brief as possible with trying to give you a lot of information at the same time. If you need me to break it down more I can. Feel free to ask any time. Hope this helps! Jen

I understand thta I have to have a title company to double closings. I have an attorney to do it and a title company to do it. The double closing will be the assignment. Thats why you do the double close. You sell to your end buyer for more, so receive the difference of the end sale. My question really is is it diffifcult to get an agent to closing to do a double close. I know now it can be done and I actually arrange to close with my end buyer first and then close with the seller. I also am trying to figure out should I should put a contingency that says that deal is contingent on my partner obtaining suitable financing? Or my partners final decision and get 21 days to provide earnest money or contract is null and void?

First , I want to congratulate you on taking action on your real estae investing .

Second , I still believe like other said above , that you are incorporating both the assignment and double close in the SAME deal.
Let me explain .. The assignment is where you have ONE close and your buyer replaces you at the close. The documents are signed and you are released from the contract you negotiated and are paid for the equity , you created.

Double Closes are pretty much two separate transactions as you are immediately reselling your property to someone else. It's a fine line here , I realize , but a distinct difference.

With the assignment, you are replaced at closing. The results are the same , just clarifying the difference between double closes and assigns.

Anyways -- great job man on the 2 properties and keep it up.

Randy

Yes, you can do it - is it a normal closing no.

First, I would have the conversation with your Realtor about how you want the deal to go - explain the Assignment and/or Double Close. If they are great with that you are in a wonderful position. I would just negociate up front what he/she needs to be paid on the transaction.

Most Brokers like say 2.8% minum....well, that may not be possible. So say you are assigning it for $5k. Maybe to you it is worth giving the realtor $2k of that. Since it will not be a normal commission negociate this upfront and put that in your assignment contract so it can be paid out on the HUD (that will save you from being taxed on the whole $5k and only getting $3k). If not have a standard contract between you and the broker and attach that to the assignment and give to the Title Company.

In Summary, Talk it through with your broker. Since it is your broker you will be responsible to pay them not the other parties, unless she brings the 3rd buyer or if it is her listing. If it is her listing than the original owners/sellers will pay her normal commission. If the 3rd party brokers bring her, if the deal goes through you may been to take her commission into consideration when marking it up. Once again, talk it through.

Let us know if we can help further.

Kingjuss...

Lot of advice flying around on this one.

Firstly, if you are doing an assignment, the contract is assigned to your buyer after it is executed between you and your seller. I have a one page assignment agreement that I use for this purpose. The assignment agreement is executed and your buyer gets the contract and closes on the property in accordance with the contract terms just as you would. Sometimes I receive my assignment fee when the contract is assigned or either get my fee at closing.

Your seller does not need to know about the assignment as long as you put "and or assigns" on the contract. I usually put this beside my name on the first page as well as beside my signature on the last.

One thing to keep in mind. Your seller is expecting you to close on the property and regardless of how many times the contract is assigned, you are first in line and they are looking at you. "And or assigns" gives you the right to assign the contract but it does not relieve you of the obligation to perform under it's terms. If your buyer does not close for some reason then you would be obligated to follow through with the closing. That is why it is so important to give yourself as many escape clauses in the contract as possible. You could also disclose to the seller your intentions but I have had a number of deals fall apart because the seller doesn't feel comfortable with those terms.

As far as a simultaneous or double closing. A purchase contract is executed between you and your seller and a subsequent purchase contract executed between you and your buyer. They both close back to back (a to b then b to c) using your buyers funds to fund your purchase. The first closing, your seller to you, is considered a "dry" closing because no money changes hands. Immediately following that closing is the one between you and your buyer. Your buyer's funds are then used to pay off your seller. Most title companies will not do these types of closings anymore but there are attorneys that will. I have a couple that don't have a problem with it.

Another thing about the double close is that your buyer does not know how much you paid for the property, unlike an assignment where your buyer sees everything. I have had buyers in the past comment on how much I was making on a deal. I simply say "I'm not counting your pennies, please don't count mine."

I usually use an assignment for wholesaling to other investors and the simultaneous, two contract method for buying and re-selling to an owner occupant or retail buyer.

As for your realtor. Just explain what you are doing and figure out what they are to be paid and work it out. There's no reason why you can't do both types of transactions with a realtor involved. If they don't understand or are not willing to cooperate, get another one. They are a dime a dozen and surely you can find one that understands these types of transactions. Get one that is also an investor and you shouldn't have any problems.

Be careful when taking advice and make sure it comes from actual hands-on experience. Your attorney should be a good source as well. You do have an attorney don't you? If not, get one immediately. Preferably one with investing experience.

I realize this was a long drawn out comment, but hope it helps clarify.

Actually this is the first time i heard that assignments will work with realtor involved, especially with the sellers realtor involved. But who am i to argue that point. I am trying to do an assignment with a sellers realtor and was nervous about explaining i was going to do and assignment deal because he kept mentioning proof of funds. Which leads to my question, how do provide proof of funds when doing an assignment deal when u r trying a no money strategy? I obviously don't have funds or i would just buy myself. What if your using a private lender to fund the deal, how do i get proof of funds that way?
Any info will help greatly close to my first deal! Thank you for your time!

Andrew

Hello, I read your post and was wondering, how long have you been on here. Proof of funds letters are very easy to get.
As for assigning with a realtor. Remember, they are the sellers realtor. So the seller pay them out of what the R.E. sold for, not for what it was assigned for. The purchase contract you use should say " and/or assign ". Then you have your assign contract that you use with your buyer that you assign the purchase contract over to. I hope this helped a lil bit. I am not an expert. Oh, somewhere on here there are post on companies that provide proof off funds letters.
I get offers from companies that provide them all the time.

I have been on here for a couple weeks I have read the books also. I understand how to do a assignment and understand their are companies that give you proof of funds but charge a rdiculous amount for them and they only provide POF for back to back closings. The fee was 3% of the closing cost plus another fee of $500 and some, no room to make it worth it. So i guess thats the only way to get one if you do not have funds yourself. Can a friend/relative be able to provide a proof of funds for me if he was going to back me. Could we right it out and both sign it? Just tryn to be creative with the proof of funds without paying a company tons for one!

Yes, you can use a friend or family member's proof of funds. Just say they are your private money lender.

One thing I would push for is having your 3rd party - the person you're assigning too - give you a proof of funds letter for the price they are willing to pay. That way you know they are willing to go forward also.

Be creative and keep working at it!