Setting Up Closing

setting up closingWhen you’re doing a simultaneous or double closing on a real estate flip, one of the things you can do is negotiate your closing costs. No matter if you’re closing with a title company or attorney, all closing costs can be negotiated and should be negotiated because you’re literally on title for a very short time and you’re turning around and selling it to your end buyer.

Very little if anything has happened in between your five-minute closings. So it makes sense then to negotiate your closing costs as much as possible. Regardless of how you close, it might be a little different but yet it’s very similar.

What I’m really trying to do is just bring to your attention the importance of you negotiating with the closing agent on this, so that you’re not overpaying. Let’s face it – every closing agent would love to write a full price title insurance policy for each of your transactions, but every closing agent would agree that that would be somewhat unfair. Because again, there is little or no time passing between the issuance of the two policies. Keep that one in mind when you do the negotiating.

Okay, the day of closing comes. This is the day you’re going to get your paycheck. Generally what you’d like to see – and if you’re going to be using our funding, we’ll help coach you through the process but generally what we like to see is for your buyer to come to the closing table say, in the morning, and execute all the documents. That’s a fancy way of saying, “sign them.” And for the funds to purchase the property from you be sitting in the closing agent escrow account then you close a little later in the day.

So, we want the buyer to come in first, say in the morning, and then you do your closing a little later in the day. In order for funding to be used we require the closing agent provide us with proof that your buyers money is in their escrow account. It just seems to work the best.

If the buyer comes and does their thing in the morning and you come and do your thing later in the morning or possibly later in the afternoon, and then you walk out on a cushion of air, probably skipping, with a nice, big, fat paycheck in your pocket.

The process of the simultaneous closing is always a little bit different with each case, but it’s very much the same t0o. Every title company or escrow company or attorney in the land understands the process. When you make them aware of the fact that you’re going to be funding your purchase – remember, it’s “A” sells to “B” which is you, and “B” sells to “C” which is your buyer, all of the tension of this simultaneous closing comes off the table, because now you’re not asking them to fund your purchase with your buyers money. If you find a title company, attorney or escrow company who will do that for you that’s great, but even if they’re willing there maybe times where they are prohibited from doing so by the title insurance company, by the seller, by the buyers lender, or by whom ever. The good news is you’ve got the funding right here for you with fund-a-flip.

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