DAY FUNDING....IS THIS NEW?

Never heard of this type of funding but, if you find out what it is all about, write another post and explain the details...Jan

Your investor is incorrect, it does exist. It is called Transactional Funding. This is a great new way of getting deals done. The stipulations are:

1. You must be able to buy a property low enough in value that you can sell and make money on. This is natural, we all do this to make money.

2. You must have a approved end buyer setup to close on the same day you buy. This is called a double closing. Approved end buyer meaning either they have cash to buy and can deposit it with the escrow company/agent or they have been approved through a lender.

3. You must use the same escrow company for the entire transaction.

There may be more requirements and you will find this out as you do the deal.

It works like this:

1. You locate a property you can buy either through a short sale, REO, FSBO, etc. You lock it up under contract.

2. You locate a end buyer, usually another investor or rehabber who has cash to buy or can come to closing with funds.

3. The end buyer is tied to deal through a contract to purchase for more than you are paying.

4. The Transactional funder deposits in escrow the total funds needed to close the deal for you, which is part A. This must be a stand alone transaction to get the property in your name.

5. The end buyer has already placed his/her funds into escrow and part B. occurs which is selling to the end buyer.

From the funds, comes out fees and the principle monies that go back to the Transactional funder, the monies to the seller and of course your profit on the deal.

This is a short version of how it is done. Go to the internet and search out transactional funders.

Hope this helps you.

Pretty sure Jimmy has it right. Basically a double closing. I know of situations where there have been 1 closing on a Friday and the 2nd closing a few days later. So the lender loaned the money for a few days or a week.

Jeremy

Different twist on a double close. Truthfully, I never heard of the term Day Funding. Jimmy, thanks for the info...Jan

Thanks Jimmy, Jeremy and Jan. That explains it.....another question, if i lock up the property and find an end buyer/investor with the cash, would Transactional Funding be the next best solution for someone to do, if assignments are illegal in their state?

I would say so unless you can get the owner to sign on for a lease/option, make some money upfront, in the middle and in the end. I think I've got down what you are thinking, but not sure yet. Hope this helps, if not come on back and we will give it some more thought...Jan

Yes, that explains it and thanks......now one last question on this subject...hopefully.
Where can i find a Trans. Funding Co. that will lend to an individual? What im understanding is they primarily lend to a business...hoping this isn't true.

Gotta know what type of deal you are looking at. Price,situation that the seller is in. Are u going to flip, buy and hold, assign or lease/option. Need more of the fine points of the deal...Jan

I haven't found a deal yet, but what i'm trying to do is flip using T Funding...if its possible and since i can't do assignments in my State.

a way around assignment is to put it on contract under a LLC then sell the LLC
this way the same LLC that put it in contract is closing no assignment there.

That's interesting Rafael...but wouldn't it be easier to start up a LLC and just get the Transactional Funding to do the A to B, B to C close ?
I believe Jimmy hit the nail on the head....not that i don't appreciate everyone helping me out......next stop, LLC!!!
I'll keep everyone posted on the success, thanks.

Woody, Google up trans. funding. Quite a few popped up