Whats the Best way to Double Close?

Question

I have read confilicting arguments on what is the best way to double close. And either of them sound smooth. These are the 2 ways that I am aware of tell me if there is another better way?

In both situations is it best to use and option or purchase contact to cloud the title?

1. Close with buyer first at title company. Buyers leaves his money with a title company without a deed? Seller shows up shortly after and I close with the seller and keep the difference?

OR

2 Close with the seller first at title company. Seller signs the deed and leaves with no money? Buyer comes in shortly after and buys the home at higher price I keep the differnce?

I could get it done dont get me wrong but it just seems like a stretch, is there an eazier way to accoplish this?
And what is the best way to lock up the home, with a recorded Contact,Option, or deed the property into a trust?
I want to learn this concept A to Z can someone point me in the right direction?

Thanks again
Tommy FL

Mitch Freed · Answer

There is a post in the short sales forum about contracts and timing that provides an interesting spin on double closings...something called the BLAST (Buy Low and Sell Today) transaction that combines an Option Contract with a Notice of Option that is actually filed with the county..the guy who posted may have some insight on these double closings as it sounds like he has been successful with them.

http://forums.biggerpockets.com/viewtopic.php?t=18741

Brian W. · Answer

instead of doing a double close I would assign the contract to the person that will ultimately end up with the property.

You take an assignment fee.  This way there is actually only one close but you still get paid.

Dick Green · Answer

I agree with Don, it's important to work with a title company skilled in such transactions.  It's been years since I've handled one but, from what I remember, seems like it was mainly dependent upon how Schedule "A", was updated.

Ty Alvarez · Answer

[Solicitation removed by Moderator]

Don Sheppard · Answer

I purchased a home earlier this year in a double close situation. We used regular purchase contracts for both closings. Not all of it really happened "in order" as John suggested. 
That is pretty much why you will have to find a title company that is willing to handle such a closing, many will not want to handle that juggling act. In reality the order it happened was the seller signed the contracts and fed ex'd them to the title company, I signed my contracts with a notary who also took my cashier's check to the title company, and the "middle man" signed both their contracts as buyer and seller last.
When it was all said and done the title company had indeed shuffled the events into the order they needed to be for recording, and checks were issued to the seller and the middle man and the deal was done.
I would think that there is a better/safer way to handle that though.

Account Closed · Answer

Tommy,

You are highlighting the problem with a double close.

The seller will sign the documents but wants to be paid. The buyer will sign the documents but wants the title if they are going to release the funds.

Legally a mortgage or a trust deed is provided by the borrower to the lender to secure the loan note. You legally have to be on title and own the property before you can legally give a lien. Hence the buyer who wants to use a lender needs to own the property before the lender will free up the funds. As  they can not provide the lien because they do not own the property yet.

Similar but not all that different to a normal escrow in that stuff has to look like it happened at the same time or in a particular order even when physically it can not. The escrow/closing agent shuffles things if and when everything is in place.

A double close takes longer. It also implies that the end buyer's lender does not care that the seller for deal two does not appear on the title work as the present owner.

I will let others comment on the best contract to use, etc.

John Corey

Thomas Martin · Answer

After thinking about the best way to work a double close i'm thinking a motivated seller wanted to get out of a property would understand that legally a sale would not take place until they have recieved the consideration stated in the contract.

With that being said, I think I could get a sellers to come to closing and sign a deed to be held in exscrow and explain to them the deed legally cannot be recorded until they have recieved to good and valueble consideration as stated in the contract.

Then get the buyer to arrive at a later point and finish the transaction pay the seller whats needed to satisfy the contract?

Do you see any hangups? or any better ideas for structuring the D.C.?

thanks again