Article Side

Online Article Directory!

Hello Guest! Login or Register to submit articles!

Wholesale Real Estate Investing: Simultaneous Closing

By Simon Macharia Subscribe to RSS | December 29th 2011 | Views:
loading
 
  



When you are involved in real estate investing buying your houses from motivated sellers, you sometimes find that you cannot manage all the properties yourself. You have to sell such properties at wholesale prices to other real estate investors.

This is called wholesale real estate investing.

In simultaneous closing, also called double closing, you buy the property from the seller, then turn around and sell it to your buyer, usually on the same closing table. Your profit is the difference between your selling price and buying price minus any closing costs.

So when do you do a simultaneous closing?

If you stand to make a sizable amount from the deal, you do not want the seller or your buyer to know. It is common for them to walk away from the deal after getting cold feet.

Simultaneous closing is an excellent option to prevent this.

How does it work?

1) Sign the contract to buy

Once you identify a good deal, put the contract under contract to buy from the seller. Fax this to your title company or closing attorney to do title work.

2) Sign contract to sell

Get a real estate investor who buys houses in your area. Put it under contract with you as the seller and they as the buyer.

Of course, your buying price must be lower than your selling price to make a profit.

Fax this second contract to the title company. You must collect earnest money when you sign the contract.

3) Close the deals

The closing company will then prepare two closing statements (HUD1), one where you buy the property and one where you sell it.

Each transaction has its own closing fees. Usually, your buyer brings money to the title company, which is also used to close the first transaction where you buy.

If your buyer borrows money from a lender, the lender must agree to have the funds close the first transaction. You walk away with the difference between the price you sell it for and the price you buy it for less your closing costs.

Notice that neither the buyer nor the seller knows how much you make in the transaction.

Advantages and disadvantages of simultaneous closing

There are two closing costs in simultaneous closing, one when you buy and one when you sell.

The lender for the second transaction can refuse to have their money to be used to close the first transaction. This means you must find a way to finance the first transaction.

Unless you have ready cash to finance this transaction, you might have to get transactional funding from a hard money lender. Transactional funding never leaves the closing table and just allows you to close the first transaction.

You must therefore account for this cost in your profits.

If your buyer is using a conventional lender, the lender may require that you own the property for at least 90 days. Such a buyer cannot support a wholesale deal.

When all is said and done, simultaneous closing is a great way to wholesale properties and walk home with big pay days.

Simon Macharia - About Author:
In successful real estate investing, you must be able to sell your houses quickly to stay in business, especially in a slow market. Learn how an interactive website for real estate investing can help you sell your houses faster by creating a buyers list and using the power of social media to reach many buyers in your market.

Share on Facebook Tweet It Stumbleupon this post This post is delicious !

Article Source:
http://www.articleside.com/real-estate-articles/wholesale-real-estate-investing-simultaneous-closing.htm

Related Real Estate Articles Subscribe to RSS

Noida real estate bringing smile to everyone’s face
Published by Komal Chauhan on December 30th 2011 | Real Estate
This article is related to noida's most luxurious project named Unitech Unihomes 3 and its various f...
 
Finest real estate properties of California
Published by Henry Fuol on June 22nd 2012 | Real Estate
The decision of buying a real estate property is very vital as it involves a huge sum of money as we...
 
Real-estate, Business
Published by Dolly on January 13th 2012 | Real Estate
Our moto has always been to 'put customers first!', that is to treat them our customers with the mea...
 
Penang: the property hotspot in real estate Malaysia
Published by Jeevan Nanthan on April 6th 2012 | Real Estate
Also, the high end condos and homes at Batu Ferringhi and Tanjong Bungah have helped in making Penan...
 
Port Washington real estate is one time solution for all property queries
Published by Jack Smith on June 15th 2012 | Real Estate
Anyone can have lot of queries when they go for property dealing. But your all queries resolved with...
 
Acquire your dream home with the help of real estate agents
Published by Deepti on May 3rd 2012 | Real Estate
If you are planning to buy a house, there are lots of things which need to be considered and planned...
 
Assistance from a good estate agency is essential in property investment
Published by Glyn Jones on January 4th 2012 | Real Estate
The estate agents can help you with the property dealings. They can make it really very easy for you...
 
Residential real estate in India- a lucrative investment
Published by Deepti on April 30th 2012 | Real Estate
Buying or selling property is always a great investment option as it is likely to give good prospect...
 
Discover reputable estate agents in your area
Published by Glyn Jones on June 18th 2012 | Real Estate
There are fairly a few different accreditations real estate agents can have. When on the lookout for...
 
Real estate agents for your property needs
Published by Glyn Jones on June 4th 2012 | Real Estate
The estate agents can help find the right kind of properties that suits your specific requirements a...
 
Hiring estate agents while cutting costs
Published by Glyn Jones on December 3rd 2011 | Real Estate
Cheap estate agents are not cheap when it comes to service. They simply charge less than those agent...
 
Important Strategies to Make Good Investments in Foreign Real-estate
Published by Dale Smith on December 27th 2011 | Real Estate
Purchase in property is commonly thought to be the beneficial method for generating revenue. It is p...
 
Some critical points to consider with estate agents
Published by Glyn Jones on January 19th 2012 | Real Estate
The estate agents can be much helpful with the real estate investments. So you are to be very carefu...
 
Costa Rica real estate investment opportunities
Published by John Mathews on July 11th 2012 | Real Estate
Costa Rica presents some of the very best real estate investment opportunities with a massive market...
 
 
Buy a Property in Cyprus in real and very cheap rates
Published by Jane Cyrus on February 6th 2012 | Real Estate
Are you planning to buy a property in Cyprus? But purchasing a property without an agent is stressf...
 
Looking for an estate agent
Published by Glyn Jones on May 10th 2012 | Real Estate
Is it advisable to work with several agents, probably not. Agents know if you are working with more ...
 
Some important legal formalities in real estate Malaysia
Published by Rick Foster on January 28th 2012 | Real Estate
Once an agreement is reached, the papers and documents are prepared that are then signed by both the...
 
Find a house or flat to rent with estate agent.
Published by Glyn Jones on July 4th 2012 | Real Estate
When you are looking for flats or houses for rent or for sale, you can simply go with the estate age...
 
Know something about the Carson Valley Real estate
Published by Dany on August 3rd 2012 | Real Estate
Having been located in the County of Douglas, the Carson Valley is a beautiful place somewhere at an...