All Forum Posts by: Shari Peterson

Yes, wet funding is pretty much required these days. Frankly, that is why my business exists. 

I appreciate everyone's input. While most may handle double closings, it is always nice to have one that is "investor-friendly". This will help my client. 

Can anyone recommend a Title Company in the Denver area that is familiar with doing same day back-to-back closings for wholesaling deals? I have a borrower that wants to wholesale flip a property to a new buyer the same day he closes. Thanks in advance!

Hi Tamara -- welcome to BiggerPockets. It is a great community of people with a lot of experience willing to help those who are just starting out.

What are your plans with the property? Do you plan to do a quick flip, essentially a wholesale deal? This means that you will be re-selling it to a new buyer the same day that you close on it. If so, it is possible you may be able to "assign" it to the new buyer. Or, if you must have two separate closings, you may be able to use your buyer's funds to pay off the seller. If neither of these options is applicable, you can also use transactional funding or a private lender to provide the funds.

I am no expert when it comes to SDIRAs, but my understanding was that you are not able to use those funds to invest in properties that you own. Nor can you invest in properties owned by your beneficiary or any disqualified person, such as members of your family. I'm sure the custodian of your SDIRA can explain in more detail what is considered a non-prohibited transaction.

One issue you may encounter is that the title company the REO asset manager has chosen may not allow same day back to back closings using transactional funding. If the Seller requires that you close at their title company, you can approach it one of three ways. You can ask if that title company will do a same day back to back closing. If so, that is the easiest fix.

If not, you can offer to pay for the title work they've done and ask that both closings happen at the title company of your choosing. It usually is less costly for you to just pay the title work at the original title company and move both closings over to the title company of your choosing. 

Lastly, if they won't do that, ask if the B side of the A-B transaction can close at the title company of your choosing. Then, have the B-C side also close at that title company. Not all transactional funding companies will fund this type of transaction but it is worth looking into as a possibility.

Hi Billy -- 

Can you tell me where the property is located?

Thanks @Zachary Myers!

 I have a few escrow agents I use for LA an Orange County for double closings, but always welcome more to add to my list. Who do you recommend using?

The way we look at it, if the funds are going to be provided for longer than a few hours that same day (for One Day Funding when doing a wholesale flip), then we as a hard money lender require that we get a Lender's policy and be named as the Lender on the HUD-1. If we are only lending for a few hours to get the A-B closed, then we DO NOT need to show on the HUD and the deal can be still be presented to the A Seller as a Cash offer. Ken, I too have seen countless deals blow up because they B Buyer thinks they can make a Cash offer and slip it under the nose of the A Seller. As long as the B Buyer understands the mechanics of how the transaction plays out between the title company and the A Seller, they can use the best strategy to get the deal to actual closing.

The first thing you need to be aware of is that you must have an escrow company (supported by a title company) that is willing to do a double close. Most do not. If you do not have someone to work with you can message me and I can help fill you in. I would recommend that you research the forums here on "getting started in wholesaling". I'm sure the methods that work elsewhere also apply to the Los Angeles area. Off the top of my head I would recommend that you follow https://www.hudhomestore.com/Home/Index.aspx. 

With REOs, usually you are not able to "assign" the contract. They won't allow you to write the purchase contract with you as the Buyer "Chad Kennedy and/or assigns". This means you need to actually close on the transaction with cash or transactional funding before you can sell to a new buyer. If you plan to sell the property to a buyer who is getting an FHA loan, FHA will not approve that loan until you as the owner of to property have owned it for a minimum of 90 days.