Need Help with Title Companies and assignment of contracts

[Xavier Benitez]

A lot of the places I've talked to have no idea with I'm talking about can you guys give me any advice I've heard of a thing called double closing dont really know what that is could someone be kid to explain it and do you think that would be a better option or a real estate attorney

[Bill Gulley]

Yes, it might be better to see a RE attorney. 

A double closing or simultaneous, as we use d them, is where the middle man acts as a buyer with the selling owner at a settlement, then the middle man acts as a seller to the end buyer, there is no assignment of a contract as deeds are conveyed to the middle man and immediately the middle man deeds to the buyer, it all happens during one settlement.

The issue with these arrangements is now that the middle man has no money, the funds used were from the real buyer and pass through to the seller, that means that the middle man didn't give the consideration of his purchase price and technically didn't purchase. 

To avoid these issues the seller could take a seller financed note at settlement, the middle man could actually buy with the note and immediately after selling payoff the note, it is extra paperwork and filing but it is a clean purchase.

When you are the middle man and the seller is aware that you will or may assign a contract (as they should be aware of) simply state in your contract that the seller will execute all necessary documents required by the title company and settlement agent. It should already be in the contract.

Then, duplicate the contract with the buyer replacing you (with your price) and have the seller and buyer sign. Before you do that, assign your contract to the buyer and collect your fee! The seller releases you and you release your rights to purchase. The seller and real buyer then work off of their sale contract. The HUD-1 on the buyer's side reflects the assignment fee as other expenses, you must disclose the fee to the settlement agent to prepare the buyer's documents. I prefer this as it cuts you out of the relationship with the seller and to property issues, the transaction is between your buyer and seller, you are simply releasing your contract rights for a fee. This may also require a higher skill set of dealing in the sunlight for some! Yes, everyone knows what is going on except the seller may not know what your assignment fee was as it only appears on the buyer's HUD-1. Local settlement practice governs at your closing. :)