Double Closings—the Do's and Don'ts Finance Articles | July 1 Nike Air Max Zero Wholesale UK , 2008 Sternberg presents the plain truth about double closings. After thirty plus years in the real estate business, Jack knows!
The term "double closing" refers to the process of buying and re-selling a property on the same day or date. Double closings were given a bad name in 2004-5 when dishonest investors committed mortgage fraud.
Their scam worked this way: They'd buy a property, work with a dishonest appraiser or bank officer and get an inflated price. Then, they'd "flip" (re-sell) the property for an equally inflated profit. Guess who got hurt? The consumer Nike Air Max 93 Wholesale UK , of course.
In fact, double closings are perfectly legal at this point in time; it's the misuse of them that is illegal.
Here's how the process of double closing generally works: Assume you're the initiator of a double closing. This makes you the "middleman." As an investor, your goal is to make a good profit without using any of your own money. So you:
Make two back-to-back closings (often in separate rooms) on the same day or date.
Use the proceeds from the second closing to fund the first one.
Do both closings in escrow so you can buy and resell the property for a profit without using any of your own money.
Make a profit because you buy the property below-market and resell it for a higher market price.
As with any real estate process, double closings have their advantages and disadvantages for you as an investor.
Advantages of Double Closings
Beyond the profit mentioned above Nike Air Max TN Wholesale UK , double closings allow you to avoid financing requirements because you can move your money quickly from one account to another. Also, you never expose the contract so you can keep the purchase price a secret from competitors and others. Finally, if last-minute hitches threaten the deal, you can back out of it with a "reverse assignment." With a reverse assignment Nike Air Max 180 Wholesale UK , you assign your contract with the end'buyer back to the owner and charge a "consideration" fee; i.e., the profit you would have made if the deal had gone through.
As a shrewd investor, you should document the consideration in writing and secure it by a lien on the owner's property. The consideration should be paid to you at closing.
Disadvantages of Double Closings
Double closings do have their downsides, including the following:
It can be stressful getting everyone and everything together for a double closing. You may feel like you're herding cats; i.e., everyone wants to go a different direction.
Some lenders simply will not do double closings due to the bad press they received. It'll be up to you to find lenders who will participate in the process.
You may not be able to buy a property cheap and resell it quickly due to "seasoning" requirements on the seller's ownership. In this case, if the seller hasn't owned the property for a minimum of six months, the lender may assume that the deal is suspect and refuse to fund the buyer's loan.
HA regulations prohibit the funding of a purchase where the seller hasn't owned the property for at least 90 days. There are no exceptions.
Do's and Don'ts
Don't go into double closings unprepared. Do be prepared to "herd cats" every step of the way! More than most deals Nike Air Max 90 Wholesale UK , double closings require close attention to detail on your part. Such closings are as much about people management as they are about financial management.
Jack Sternberg
Article Tags: Double Closing, Double Closings
How To Choose A Business Coach Business Articles | June 22, 2011 In today's competitive economic climate, an increasing number of professionals are turning to business coaches to help them achieve their ultimate goals.
Business coaches may help an individual with personal development or may even work with an organization with human resource development. If you are seeking a personal business coach Nike Air Max 95 Wholesale UK , you are likely looking for somebody who can provide feedback and advice to help you improve the effectiveness, profitability, or efficiency of your business. Business coaches can also help you improve communication, set priorities Nike Air Max 1 Wholesale UK , make sound business choices, and expand on your strengths. So how then do you approach choosing a business coach?
As is the case with any professional relationship where you are paying for services, compatibility is a key factor. Do you have a good rapport with your coach? Do you have a similar approach or does your business coach's approach help you develop better skills for reaching your goals? Can you communicate easily and comfortably with your business coach? These are all very important questions. In order to have a successful relationship with your business coach, you really need to come from a place of common ground. If your values and expectations differ widely from those of your business coach Nike Air Max 97 Wholesale UK , there is little chance the experience will be a positive one.
In addition, your business coach should demonstrate appropriate experience and training in your field. A woman who worked for 40 years in the restaurant industry is not likely going to be equipped to coach you about software development, for example.
Thema drucken
21.11.2019 03:01
Antworten
