Double Closing vs. Assignment: When to Use Transactional Funding

Once you have a buyer for your contract, you have two ways to get paid: assign the contract, or double close. Most first deals are assignments. But when the fee is large, the seller is sensitive, or the buyer is using a lender that will not fund an assignment, a double close with transactional funding is the tool. Here is how both work, what each one costs, and when to use each.

The choice matters more than most new wholesalers expect. The same contract, the same seller and the same buyer can produce a smooth closing or a blown deal depending on which exit you pick and how early you pick it. The best time to decide is before you send the contract to your buyers, not the day before closing.

Option 1: Assignment

You sign an assignment of contract with your buyer, they step into your purchase agreement, and the title company pays your fee from their funds at closing. One closing, one set of closing costs, and your fee appears on the settlement statement, so the seller and buyer both see it.

• Best for: modest fees (many wholesalers use roughly $15,000 as a rule-of-thumb ceiling), cash buyers, sellers who understand you are a wholesaler.
• Cost: nothing beyond your normal closing costs.
• Risk: a buyer who sees a large fee may try to renegotiate at the table. A non-refundable deposit in the assignment agreement is your protection.

How an assignment closes, step by step

1. Confirm your purchase agreement allows assignment (the buyer is written as your name “and/or assigns” and nothing in the contract prohibits it).
2. Sign an assignment agreement with your end buyer that states the fee, the non-refundable deposit, and the closing date.
3. Send the purchase agreement and the signed assignment to the title company, and have the buyer’s deposit wired to title.
4. Title prepares one settlement statement showing the seller’s price and your assignment fee as a line item paid by the buyer.
5. The buyer funds, the seller signs the deed directly to your buyer, and title pays your fee at closing.

Option 2: Double close

You actually buy the house from the seller (the A-to-B closing) and sell it to your buyer minutes or hours later (the B-to-C closing), often at the same title company on the same day. Your profit is the difference between the two prices, and neither party sees the other’s numbers.

• Best for: large spreads, sellers who would balk at a visible fee, buyers using hard money or conventional lenders that require the seller of record to be you.
• Cost: two sets of closing costs plus the funding fee below.
• Risk: you need funds for the first closing, even if only for an hour.

Why do you need your own money for the first closing? Many title companies will not use the end buyer’s funds to pay for your purchase. They want the A-to-B closing funded independently, so each transaction stands on its own. That gap is exactly what transactional funding fills.

What transactional funding is

Transactional funding is a short-term loan — typically same-day to a few days — that covers the A-to-B purchase when you already have a signed end buyer for the B-to-C sale. The lender wires funds to title, the second closing repays them, and you keep the spread. Because the end buyer is already committed, there is no credit check and no appraisal; the lender is underwriting the closing, not you.

• Cost: commonly quoted as a percentage of the loan amount plus a small fee. For example, at 1–2% that would be $2,000–$4,000 on a $200,000 purchase. Get a written quote before you rely on any number.
• Requirements: a signed purchase agreement, a signed end-buyer contract with proof of funds, and a title company that handles double closings.
• Where to find it: hard-money lenders in your market, national transactional lenders, and the title company itself, which usually has a short list.

How a double close with transactional funding runs

1. Lock up the A-to-B contract. Your purchase agreement with the seller, with a closing date that gives you room to find a buyer. Our guide on how to write a wholesale offer covers the terms to include.
2. Sign the B-to-C contract. A separate purchase agreement where you are the seller and your end buyer is the buyer, at your resale price, with a meaningful deposit.
3. Confirm the title company will do it. Ask directly whether they handle back-to-back closings and whether they accept transactional funding. Some do not.
4. Apply with the funder. Send both contracts, the end buyer’s proof of funds or loan approval, and the title company’s contact details. Do this a week or more before closing, not the morning of.
5. Close A-to-B. The funder wires to title, the seller signs the deed to you, and the seller is paid.
6. Close B-to-C. Your buyer funds, you sign the deed to them, title repays the funder, deducts both sets of costs, and wires you the rest.

A worked example with simple numbers

The numbers below are illustrative only, to show how the math works. Your closing costs and funding quote will be different.

Say you have a house under contract at $150,000. Based on your ARV and repair estimate, an investor on your list agrees to pay $175,000. The spread is $25,000.

• As an assignment: your fee is $25,000, shown on one settlement statement. Your costs are small. But the seller sees a $25,000 line item on a house they sold for $150,000, and the buyer sees that you are making $25,000 on a contract you never closed on. Either one may push back.
• As a double close: you borrow $150,000 for a few hours. If the example funding cost is 1.5% ($2,250) and your side of two closings adds, say, $2,500, you keep roughly $20,250. You gave up about $4,750, and in exchange neither party sees the other’s price.

Now shrink the spread to $8,000 on the same house. The double-close costs in this example would eat more than half the fee, which is why smaller fees are almost always assigned.

How to choose

1. Modest fee and a cash buyer? Assign.
2. Fee that would make the seller or buyer uncomfortable if they saw it? Double close.
3. Buyer’s lender will not fund an assignment? Double close.
4. Not sure? Ask your title company which one they recommend for this deal. They have seen both fail and both succeed.

State rules also play a part. Some states regulate how wholesalers market contracts or require disclosures, and a few treat repeat assignments differently from a double close. Read is wholesaling real estate legal for the general picture, then check your state’s page, for example the Texas wholesaling guide.

Common transactional funding mistakes

• Waiting until closing week to line up funding. Funders need both contracts, title contact details and the end buyer’s proof of funds. Start the moment your buyer signs.
• Using a title company that has never done a double close. An inexperienced closer can delay the second closing or refuse to use the funds. Ask before you open title.
• Ignoring seasoning rules. Some end-buyer loan programs will not finance a property the seller has owned for only a few hours. Ask your buyer what kind of loan they are using and have their lender confirm a same-day resale is acceptable.
• Forgetting to budget both closings. In a double close you pay costs as a buyer and again as a seller. Run the numbers before you choose this route.
• Having a weak end buyer. The funder is only as safe as your buyer. A buyer with verified funds and a real deposit is what makes the whole structure work. See how to find cash buyers before your first deal.

Double close checklist

• A-to-B purchase agreement signed, with a closing date you can meet
• B-to-C purchase agreement signed, with a non-refundable deposit at title
• End buyer’s proof of funds or loan approval in hand
• Title company confirmed for back-to-back closings and transactional funds
• Written funding quote received and application submitted
• Estimated settlement statements for both closings reviewed
• Net profit recalculated after funding fee and both sets of costs

Transactional funding FAQ

Do I need good credit to get transactional funding?

Usually not. The funder is repaid from your end buyer’s closing, so they focus on the strength of both contracts, the buyer’s funds and the title company, not on your personal credit.

Can I double close without transactional funding?

Yes, if you have the cash to fund the A-to-B purchase yourself, or a private lender willing to cover it. Transactional funding exists for wholesalers who do not want to tie up their own capital, even for a few hours.

What happens if my end buyer backs out?

Transactional funding is tied to the B-to-C closing, so if your buyer walks before closing, the funder will not wire. You still have your contract with the seller, and your options are to find another buyer within your closing timeline or to use the exit terms in your purchase agreement. A real deposit from your buyer makes this far less likely.

Does a double close require a real estate license?

In a double close you take title and resell as a principal, which is one reason some wholesalers prefer it. Licensing rules vary by state, though, so read do you need a real estate license for wholesaling and your state guide.

Whichever route you use, the purchase agreement is the same. Only the way you get paid changes. The contracts are explained here.

Working a specific market? Our state-by-state wholesaling guides cover the licensing rules, deed records and probate courts for each state and its major cities.

Wholesaling guides for top markets