So mad I can't see straight...please advise...URGENT - Posted by Tyler

Posted by ScottE on May 28, 1999 at 18:02:17:

Just sign your part of the documents for the second closing (you selling to your buyer)before you do anything and the title company can hold those documents “in escrow” for the short period of time while you ‘borrow’ the money from your buyer to get the property from your seller. This should set her mind at ease as well as your buyer. In effect you wouldn’t be able to run away from the title company after signing and using your buyers money.

Hope this helps.


So mad I can’t see straight…please advise…URGENT - Posted by Tyler

Posted by Tyler on May 28, 1999 at 14:35:46:

Today I signed two contracts to sell two props I’ve got tied up on contract. Great. Cool. I’m stoked.

First thing I do, is go to the title company that I am forced to use on one of the deals because it’s a Freddie Mac. I go in and attempt to set up a double close. AS I SUSPECTED, I was told “this can’t be done.”

Do you have any idea how hard it is to keep your cool when a lady that has been in the business for over 25 years is sitting across the table from you saying “what you are doing is ILLEGAL”?!? She even went and spoke with the manager of the company and still came back with, “This is absolutely illegal. You do NOT have an interest in this property and cannot sell it.” “We cannot close this deal before we close yours…” (which brings me to a question: How do they do a double close if the money funding the deal is coming from MY BUYER? How do they close my first deal, in order to proceed with the second, without the funds from ME?? This is something I’ve NEVER understood, but have always been told “don’t worry about it…just let the title company handle it…” yeah- this is EXACTLY what I was afraid of!)

It was quite a chore to remain diplomatic. I simply told her I would find another way to work it out. I hope this won’t raise any red flags with Freddie Mac…


What’s the deal??? I need to figure out a way to solve this…and I don’t want to assign because my profit is $11k.

My other deal, I can do through my Title co, although I have NOT done a double close yet. I talked to the manager at my TC a month ago, and she said it could be done and would cost ME only about $75 (seemed low). I have not gone down there yet to turn in my other deal because of my disorientation about the whole thing.



Re: So mad I can’t see straight - Posted by JPiper

Posted by JPiper on May 29, 1999 at 12:21:12:

As a preface I first will point out that in the last 20 years I have not done a simultaneous close. No particular reason?..nothing wrong with a simultaneous close. I just have preferred to assign my contract in some cases?.or in others I have closed?.and then at some time later have resold the property. I would add that I don’t happen to agree with some of the sentiments that I hear and read regarding assignments?..that is, the idea that you need to hide the amount you’re making if it exceeds a certain dollar level. To me, what I paid for a property has NOTHING to do with it’s end value?.or whether it’s a good deal to a second buyer. Your ability to put an assignment over has to do with your stance?..your ability to walk away from the negotiations with an assignee and assign to someone else who looks at your deal as to it’s value, not as to what YOU paid for it. I can honestly say that ANYONE who was to bring a deal to me and want to assign can rest assured that I will judge the deal based on the end value to me?.not based on what YOU paid.

Second, I will reiterate what JohnBoy says in his post. You DO have an interest in the property. Your interest is created the instant your offer is accepted by the seller. That interest is called “equitable title”.

Think about the purpose of an escrow. It’s purpose is to collect all the documents and funds from the buyer and seller as set forth in the contract, and make certain that all the provisions contained in the contract are complied with. At the moment when all documents have been executed, all contract provisions complied with, and all funds are available?..the “switch” is made so to speak. Money is handed to the seller, the deed is handed to the buyer. NOTE: the “closings” of the buyer and seller DO NOT have to take place on the same day, in the same room. The “closing” does NOT have to be attended by the parties (at least where I am located). We DON’T have to jockey between rooms. The WHOLE purpose of an escrow is to collect all the documents?..and when this has been done, a “closing” can take place?..with NO ONE sitting there but the closing agent. Again, I describe this according to the locations I have been involved with?several states. It’s possible that there could be local differences.

Think about a simultaneous close. Buyer #1 comes in to close. This can be a time totally separate from EVERYONE else. You execute your documents. You in essence tell the escrow officer “Hold these documents UNTIL the seller does EVERYTHING he is supposed to do?.don’t close until then.” Seller #1 comes in (or mails in) his documents?.he in essence says the same thing. Seller #2 (who is Buyer #1) executes docs. Buyer #2 executes documents. All documents from the 4 separate parties are now held in suspended animation. At the appropriate instant, when all the provisions of the two contracts are complied with and all the documents are in place, the escrow officer closes ALL the transactions simultaneously?..BING, BANG, BOOM.

There will have been a BRIEF period where the deed to the property was switched to Buyer #2 by Seller #2 BEFORE Seller #2 (as Buyer #1) had title. During these few seconds, the escrow agent has complete control of the funds from Buyer #2, and therefore there is absolutely NO risk to Seller #1. Think of seconds here.

I would imagine that the escrow agent would have NO difficulty if Seller #1 deeded a property to Buyer #1and if Buyer #1 excuted a “One-Minute Note” in favor of Seller #1 for the purchase price??a note that would then be paid off seconds later by the funds from Buyer #2 However this is UNNECESSARY since the escrow agent has total control of the deeds and funds involved in both transactions.

Understand something here. In this business you are going to be constantly confronted with issues that make little or no sense. You’re going to be required to deal with these issues whether you like it or not. I’ve found that the BEST way to deal with issues is to ASK QUESTIONS. Asking questions carries some advantages. First, the other person has to talk in order to answer a question?..especially when you ask an open-ended question. While they’re TALKING, you’re LISTENING and THINKING. Questions GIVE YOU TIME?..time to collect your thoughts and formulate an answer or a plan. Perhaps?. “Gee, why do you think this is illegal?” Questions bring out the REAL issues, so that you can MAKE SURE that when you finally address the issue, you’re addressing the REAL issue. I like to ask leading questions??questions that direct the conversation along a line that leads to a conclusion?perhaps a conclusion that is contradictory to the premise of the original issue. “Gee, if this is illegal, why do you suppose that XYZ Title Co. does these types of transactions?” Wait for an answer. “Would it be helpful to you if XYZ Title Co. told you how they handle these?” “Can I speak to the manager myself, so that I can ask some of my questions directly?” “What ways can you think of to get this transaction done?” “Would it help if my attorney called and discussed this with your manager?” “I understand now why YOU think this ‘illegal’. If you knew it wasn’t ‘illegal’, is there a way you could get this tranaction done?”

Sometimes you can’t resolve issues or problems in one hour or one day. Call your other title company. Ask more questions about the process?..they evidently are comfortable with it. Perhaps these questions will give you more information with which to discuss the situation further with the first title company.

Good luck?and remember?.this is what they call experience. Just think, if there were NO problems in this business, everyone would do it.


What about some kind of a bridge loan? - Posted by Ben

Posted by Ben on May 28, 1999 at 19:26:05:

I am no expert in this but it seems based on the
validity of both contracts, that a bank,investor or even family member would be willing to put up a short term bridge loan for the time involved between closings. Also, if it were me I would not want seller and new buyer anywhere near each other. I would not want to take the risk of somehow getting cut out of the deal. Maybe you can do it a day (or even hours) apart if you can secure that bridge loan.

Re: So mad I can’t see straight…please advise…URGENT - Posted by JohnBoy

Posted by JohnBoy on May 28, 1999 at 15:13:42:

“You do NOT have an interest in this property and cannot sell it”

You most certainly do have an interest in this property. The seller can’t legally sell it to someone else while you have a binding contract on it. That gives you an interest in the property.

“We cannot close this deal before we close yours…”

Um DUH Lady! THAT’S EXACTLY what I want you to do! They close between you and the seller. You take title to the property. Now you close between you and your buyer. This all takes place at the same time. A “simultaneous closing”!

Since YOUR buyer will be paying YOU more money than you will be paying to the original seller, then you don’t need to bring any funds to the closing. They simply take the funds from your buyer and pay off your seller. The difference left over when it’s all said and done goes to you. Simple! Perfectly legal!

Ask to speak to the title companies attorney and explain what it is your doing. Tell them you ARE going to close with the seller and you ARE going to take title in your name! Only your going to have title in your name for about 2 minutes while they close between you and your buyer.

YOU are buying the property period! You are then reselling the property immediately after closing with your seller. Since everything will be closing all at the same time then they can just use the proceeds coming from your buyer to pay off your seller and give you the difference! Simple!

Ask her this. Lady, if I come in and I close with the seller by taking title in my name, how long do I have to legally wait before I can sell the property to someone else??? Is there a law that says I must own the property for a certain period of time before I can resell it?? If you say there is, then how long would that be??? 10 seconds? 1 hour! 1 day? 2 days? How long??

If I bring in a buyer at the same time ready to buy the property from me following the closing, do you think that is something you could handle?? GOOD! THAT’S EXACTLY what I want to do! I want to close with my seller and then resell it to my buyer and I want this all to take place at the same time! Is that going to be to difficult for you to handle???

Re: So mad I can’t see straight…please advise…URGENT - Posted by johnman

Posted by johnman on May 28, 1999 at 20:36:21:

You tell them buddy! I like it!

Show me the money… - Posted by Tyler

Posted by Tyler on May 28, 1999 at 15:34:14:


The part I think she is hung up on (and I have no answer for) is that I am coming to the table with no money.

How do they CLOSE my deal, without any money coming from me BEFORE I sell to my buyer. Obviously my buyer is coming in with more money, but that money “can’t” come to me, until the title is in my name, and he is buying from me.

How am I effectively using HIS money to close MY deal??

Again, this is where she is coming from. I suspect this is the case because of her comment, “we can’t close your sale before you buy”…(so where is YOUR money to close YOUR deal??)…

Re: Show me the money… - Posted by JohnBoy

Posted by JohnBoy on May 28, 1999 at 16:05:20:

Your money is coming from YOUR buyer, period! They close with you and the seller. Next they step into the other room and close with you and your buyer. They take the money from your buyer and pay off your seller. This all happens within a matter of minutes. The original seller sits there for a few minutes after all the documents have been signed off. The title company says, I’ll be right back to dispurse the funds. They leave the room as if there going to get the checks drawn up to dispurse. They jump over to the next room and close with you and your buyer. They get the funds dispursed from your buyer. Then go over and draw up the proper checks to dispurse to your seller from the funds they just collected from your buyer. While all this is happening you’ve already taken title for the moment from closing with the seller. In the end everyone gets paid and the deal is closed between everyone involved. End of story.

If you keep running into a problem with this then get an attorney that knows how to handle a simultaneous closing. Maybe he could help out with getting the title company to take care of this. Besides, it’s better if you have an attorney their to represent you to make sure everything is handled properly. That’s well worth the $200-$300 he will charge you.

Re: Show me the money… - Posted by Tyler

Posted by Tyler on May 28, 1999 at 16:33:58:


I appreciate the responses.

I must point out, here, that although I know it is perfectly legal to do this, I don’t know how to get that throught the thick skull of someone who’s been in the business most of MY life. And even explaining it the way you did, which is all I know, does not give her the info on the logistics of how to handle everything on HER SIDE OF THE TABLE.

My other deal with my TC, is progressing smoothly. After I calmed down, I called them and got everything going. No problems.

I think my best solution, without having to get creative to make it happen (I don’t want to alarm my buyer with complications), is to call an attorney. Perhaps he can call and explain how a simultaneous close is done. I was going to have the gal call my TC and have them explain it, but I don’t want to create a mess.

Case and point. ALWAYS deal with your team unless you ABSOLUTELY CANNOT!

I’ll keep you posted…