REO Double Close Costs

[Brian Karr]

Hi all,

Recently I had a REO property under contract and was going to double close it, in order to wholesale to another buyer. In double closing, there were 2 sets of closing costs to pay. The first on my deal with the bank (3% of purchase price), and the second on my deal with the end buyer (3% of sale price). Additionally, there were agent commissions that I would have had to pay on the initial sale between me and the bank, which in a normal wholesale gets passed on to the end buyer. And I also needed transactional funding (1.75% of purchase price) to make the deal work.

If I was doing the flip it was a fantastic deal. However, these costs added almost $50k in additional fees that would not have been in place if the property was not a REO. These fees drove up the price of what I could wholesale it for, and I ended up having to pull out of the deal because I couldn't move it.

I'm wondering if there is any advise out there on what I could have done to avoid some of these fees, or if this is just standard for REOs and simply need to be accounted for in my numbers?