Danforth

Almost all investing in foreclosures strategies have their advantages and risky disadvantages. However, there’s one unique way to “double cross” the investments. The real estate investment strategy, called ‘double closing’, allows a dealer to earn a greater profit margin, than an assignment of contract. With a contract assignment, there is unfortunately quite a big potential that the deal will ultimately fall through.

The dealer is under protection of the law, after having already received the proceeds from the sale of the contract. But the retailer, who buys the contract personally, is wary of the deal falling through and will factor it into the price he is willing to pay. And that’s the perfect time for the double closing strategy. With this method the dealer has a great risk with a greater reward. It assumes more risk because if the deal falls through, the dealer receives nothing.

A double closing begins after the dealer has signed a purchase contract with the property owner. After that, the dealer signs a contract with the retailer. This is a very important document, because trough this contract the retailer agrees to buy the property from the dealer at a higher price and deposits that amount in escrow. The next steps practically include the property owner, signing the deed to the dealer, who then signs it to the retailer. Afterwards, the retailer signs the loan documents. The process is complete - the property owner is paid his asking price, and the dealer is paid the difference. The main trick, that the dealer came to the table with no money, so the credit was never an issue.