What Is Double Closing in Real Estate in North Carolina?

TL;DR

A double closing in North Carolina requires wholesalers to first purchase a property before selling it to a buyer or to assign the contract to the buyer for a disclosed fee. Unlike other states, wholesalers cannot use buyer funds to complete the initial purchase, necessitating transparency about assignment fees to all parties involved.

Transcript

okay this one i might stumble through a lot it's kind of it's a complicated kind of complicated thing to explain hey everybody i'm tiffany weber and i'm a north carolina real estate attorney and today i'm answering the question what is a double closing now most often the term double closing is used in a wholesaling context but every once in a while... Read More

Key Insights

• ✋ Double closings are commonly associated with wholesaling in real estate, where wholesalers make quick profits by finding buyers willing to pay higher prices for properties.
• 🤱 North Carolina has specific regulations regarding double closings, requiring wholesalers to either have separate transactions or take an assignment fee.
• 🥳 The assignment fee must be disclosed to all parties involved, ensuring transparency and compliance with ethics rules and laws.
• 🇰🇵 Real estate wholesalers in North Carolina should consult with a real estate attorney to understand the proper procedures and ensure legal compliance.

Questions & Answers

Q: What is a double closing in real estate?

A double closing in real estate refers to a transaction where a wholesaler purchases a property from a seller and then immediately resells it to a buyer at a higher price.

Q: Can double closings be done in North Carolina?

Double closings, as commonly understood in other states, are not possible in North Carolina. Instead, wholesalers must either have separate transactions or take an assignment fee.

Q: What is the process for double closings in North Carolina?

In North Carolina, a wholesaler must first purchase the property from the seller at an agreed-upon price, then sell it to the buyer at a separate agreed-upon price or assign the contract to the buyer and receive an assignment fee.

Q: Are wholesalers required to disclose the assignment fee in North Carolina?

Yes, wholesalers in North Carolina are required by ethics rules and laws to disclose the assignment fee to all parties involved. It must be shown as a line item on the closing statement.

Summary & Key Takeaways

• A double closing in wholesaling involves a wholesaler going under contract with a seller for a lower price and then finding a buyer willing to pay a higher price for the property.

• In North Carolina, double closings are not possible as wholesalers are required to either buy the property from the seller and then sell it to the buyer in a separate transaction or take an assignment fee.

• The assignment fee must be disclosed to all parties involved, and it appears as a line item on the closing statement.