Why you should be happy your wholesaler double closes their deals

[Trey Watson]

Opinion:

I work for a major wholesaler in Houston, Texas. On day 1 of meeting any new potential client, one of the main points we go over is that we do a double close on all deals and the investor is responsible for our closing costs as well as their own. Very important to disclose. Does that make you jump for jump for joy? Probably not....sounds expensive. But you should be jumping for joy. You should bake your wholesaler some holiday cookies if they can double close. I'll take oatmeal raisin. 

If your wholesaler double closes, that means they have the ability to put their money where their mouth is. That means they can fund their own deals. That means they have negotiating power because they don't have to put that "and or assigned" next to their name. The wholesaler is saying 'hey Mr seller, our company may sell off your property to an investor but we are buying it with our own cash and taking title. 

In my opinion based on experience, this allows for better quality deals. The wholesaler is generally more reliable and sellers are more willing to work with them. Sure its more expensive for the investor. But if your wholesaler tells you on day 1 that you should expect 2 closing costs, then it is now your responsibility to account for that when calculating potential profit. If the profit margin works, then why does it matter if you pay 2 sets of closing costs? It's the cost the play the game. Could you have found a better deal elsewhere with no double close? If so, then go buy it.