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

Are you searching for real estate project in Bhopal?
Published by Manish Kumar on June 14th 2012 | Real Estate
Many homebuyers sometimes get confused about buying a new home or apartment. They think that waiting...
 
Cape Coral real estate a great investment make no mistake
Published by Anne Mary on December 10th 2011 | Real Estate
Cape Coral has some of the finest properties in fantastic surroundings, but mistakes in the real est...
 
Options for a real estate
Published by Loo821ql on February 26th 2012 | Real Estate
If you are learning how to be a registered realtor or simply would like to know more about real esta...
 
Awesome place naples florida waterfront real estate
Published by Harry on June 19th 2012 | Real Estate
waterfront homes for sale in naples florida. This is a community that is highly sought after for go...
 
Dubai, a real charm for investors and residents alike
Published by Mark Castellino on December 27th 2011 | Real Estate
Dubai is one the real charms for the real estate investors. So many investors invest their money in ...
 
Investment in residential real estate- a lucrative option
Published by Neha Gupta on May 8th 2012 | Real Estate
For a potential investor, investment in the real estate means a good deal of sense. When it comes to...
 
Find realtors, and real estate market advice on my-realestates.com
Published by Samuel on February 3rd 2012 | Real Estate
The largest directory of real estate brokers on the internet now makes it easy for you to find real ...
 
 
 
How can you become a successful real estate investor
Published by Deepti on April 17th 2012 | Real Estate
Real estate investment is an important financial decision which an individual makes. In order to be ...
 
How a real estate agent can help you find your dream home
Published by Deepti on April 17th 2012 | Real Estate
If you are planning to buy a new home, you would need to seek the assistance of an expert real estat...
 
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...
 
Shaky real estate off Andheri
Published by Prop Tiger on July 16th 2012 | Real Estate
Maharashtra Chamber of Housing Industry, shaped in 1982, is that the most distinguished and also the...
 
Rising investments in Bangalore real estate
Published by Prop Tiger on July 4th 2012 | Real Estate
The Bangalore commercial market has witnessed a healthy transaction activity throughout the month of...
 
Real estate in India- an ideal destination
Published by Deepti on April 16th 2012 | Real Estate
The real estate of the country significantly contributes to its economy. The Indian realty contribut...
 
Why need estate agents for realty investments
Published by Glyn Jones on December 23rd 2011 | Real Estate
The real estate agents have a huge list of database and they can give you some better information ab...
 
Hire estate agents Marlow for smooth property deals
Published by Ricky Charles on January 4th 2012 | Real Estate
Many businesses have flourished and doomed but the real estate business has somehow managed to keep ...
 
Consult a reputed real estate dealer to know more about Temple TX real estate
Published by Sophiegeorgia on June 18th 2012 | Real Estate
Home buyers opted for panic selling which have of course opened up profitable avenues for buyers who...
 
Explore real estate companies for housing accommodations
Published by Abhay Singh on December 30th 2011 | Real Estate
We have to move to many places in our entire life span, sometimes in search of better education, som...
 
It’s time to go with real estate India again
Published by Mike Nicholson on May 4th 2012 | Real Estate
Those days are gone when real estate in India was not a lucrative sector. Today, it has developed in...