When to Use Double Closing

Double closing is ideal when:

1. Confidentiality in Profits is Important: Investors seeking to keep their profit margins private often choose double closing.

2. Greater Control in Resale is Needed: This method offers flexibility in resale pricing and negotiation.

3. Funding is Accessible: It suits investors who have the financial resources for a temporary property purchase.

When to Use Assignment

Assignment works best when:

1. Limited Capital is Available: This method is more feasible for investors with less access to funding.

2. Speed is Essential: Assignment facilitates faster transaction processes without property ownership.

3. Simplicity and Lower Risk are Desired: It reduces the complexities and risks associated with property transactions.

Advantages and Disadvantages

Double Closing:

• Advantages: Offers higher profit potential, more transaction control, and keeps earnings confidential.
• Disadvantages: It requires more capital, involves greater risk, and may incur additional closing costs.

Assignment:

• Advantages: Involves lower risk, requires less capital, and has a simpler process.
• Disadvantages: Provides limited control and less profit potential, with transparent fees.

Legal and Financial Considerations

Legal and financial understanding is crucial for both strategies. Investors should be aware of local real estate laws and regulations. Consulting a real estate attorney is recommended to ensure compliance. The National Association of Realtors offers resources for legal practices in real estate.

Choosing the Right Strategy

The choice between double closing and assignment depends on an investor’s financial situation, risk tolerance, and objectives. Thoroughly understanding each method allows investors to make informed decisions that align with their investment strategies. EMD Transactional Funding specialize in real estate financing, including Double Closing scenarios.

Conclusion

Double closing and assignment are both effective strategies in real estate, each suited for different scenarios. Double closing offers more profit and control but requires significant capital and carries more risk. Assignment is simpler and less capital-intensive but provides less control and potential profit. Knowing these strategies’ nuances and considering their legal and financial implications is key for real estate investors. Staying informed and connected with industry resources like BiggerPockets is essential for successfully navigating real estate investment strategies. With the right knowledge and approach, both double closing and assignment can be valuable tools in the real estate market.