questions about double closings and land trust

[Chris Jones]

hello everyone, well anyway i'm a new investor and after some research i decided to focus on pre-foreclosures.

well anyway i was told of a strategy that i could use that didn't involve the use of any of my money or credit and will allow me to actually retail these properties to end-buyers and not just wholesale them for a small profit to other investors, it sort of goes like this.

1- locate and market to the people in pre-foreclosure, 2- once they contact me setup an appointment with them, 3- setup a land trust with them ( which they will be the beneficiaries and either me or a disinterested party the trustee)and have them sign a "warranty deed to trustee" doc which i will record at the my local court house, 4- also have them sign over there beneficiary interest to you which you'll store away for protection of problems that might come up in the future 5- start marketing the property as well as working on the short sale with there lender, 6- once i have my end-buyer (and hopefully my short sale is accepted in time) have my title company perform a double closing to pay off the first lender as well as myself, and to give the end-buyer clear title without any seasoning issues coming up (which i was told there has to be two separate HUD's, two separate escrow accts and etc)

so my questions are:

do i have all the steps down correctly or am i missing something?

how in the world do i explain this double closing thing to a title company, like how do i explain to them how to do this paper shuffle ? because they either know what it is and they just don't do it or do, or they just don't know what it is and need you to break the whole process down for them.

[Will Barnard]

Originally posted by short_sailer:

If you use an option contract instead of a land trust

...will recording an option contract also cause the deal to be killed if the bank finds out?

Why?

Are you implying that you do not want to give proper disclosure to all parties? If so, you are asking/begging for trouble. You can use an option contract or a full blown purchase and sales agreement and still double close (not simultaneous close) using transactional funds and investing with little or no money out of pocket. The key is to have the proper team in place such as a title/escrow company familiar and capable of back to back closings, an attorney, to properly advise you and construct your documents for full legal disclosures and verbiage in your documents, and a quality transactional funder.

With all of that, you can successfully complete short sale transactions. The other missing link is to have the knowledge to negotiate with the selling bank and make the deal work for all parties involved (homeowner, selling bank, you, end buyer, agents)

Good luck.