can this transaction be done?
Does any one on here know if this can actually be done or is this just something you read in misleading books and courses?
Step 1: The dealer signs a written agreement to purchase a property from the owner.
Step 2: The dealer signs a written contract with the retailer under which the retailer agrees to buy the property from the dealer at a higher price.
Step 3: The only party coming to the table with cash is the retailer. Assuming the retailer is borrowing money from lender to fund the transaction, the retailer's bank will wirer the funds into the bank account of the attorney, escrow agent, or title company (called the closing agent) who performs the closing.
Step 4: The owner signs a deed to the dealer, which is not delivered but deposited in escrow with the closing agent.
Step 5: The dealer signs a deed to the retailer that is deposited in escrow with the closing agent.
Step 6: The retailer signs the bank loan documents, at which point the transaction is complete.
Step 7: The closing agent delivers the funds to the owner for the purchase price, the differnce to the dealer.
Step 8: The closing agent records the two deeds, one after another, at the county land records office.
Mick
It can be done and it's called a double closing. But beware of the new "dealer" issues that have recently popped up. You have to make sure the retailer gets a non-seasoned loan in order for this whole transaction to be completed.
A non-seasoned loan is a loan that does not require the previous owner to hold title of the property in question for more than one year. With seasoned loans, the previous owner (deed holder) must have owned the property for over a year. Lenders have caught onto investor's creative techniques and are trying to avoid these practices by only offering seasoned loans. But, you can find non-seasoned loans by having a mortgage broker locate one for you.
You may want to read the book by William Bronchick called "Flipping Properties." It explains ways of flipping properties via assignment and double closing. It also touches on the "dealer" status issue. You can buy it for $20 or get it from your local library. Note: Bronchick is a real estate attorney.
Tanya