What Happens at a Wholesale Closing?
For new wholesalers, the closing process can feel mysterious. What actually happens at the title company? Who signs what? When do you get paid? The process is straightforward once you understand the two main closing structures: assignment and double close.
Assignment closing (the simple version)
In an assignment closing, the seller sells directly to your end buyer. You never take title to the property. The title company handles the transaction, and your assignment fee is paid from the proceeds.
Step-by-step process
- Title company receives the contract and assignment. You send them your original purchase contract with the seller and the assignment contract with your buyer.
- Title search is completed. The title company researches the property's chain of title to ensure clear ownership and identify any liens or encumbrances.
- Closing documents are prepared. The settlement statement (HUD-1 or closing disclosure) shows the seller's proceeds, the buyer's costs, and your assignment fee.
- Buyer sends funds. Your end buyer wires their purchase price (your contract price plus your assignment fee) to the title company.
- Signing. The seller signs the deed transferring ownership to the buyer. The buyer signs the closing documents. You sign the assignment acknowledgment. In many cases, all parties do not need to be present simultaneously.
- Recording. The title company records the deed with the county.
- Disbursement. The title company disburses funds: the seller receives their contract price, you receive your assignment fee, and any lien holders are paid. This typically happens same-day or next business day.
Key details about assignment closings
- Your fee is visible. Both the seller and buyer can see your assignment fee on the settlement statement. This is why some wholesalers prefer double closes when the fee is large.
- You may or may not attend. In some markets, you sign your documents separately or even remotely. Ask the title company about their process.
- Closing costs are minimal for you. The seller pays their closing costs, the buyer pays theirs. Your only cost is usually a small title company handling fee ($200-$500).
Double close (the privacy version)
In a double close, two separate transactions occur, typically on the same day or within a few days:
Transaction 1: A-to-B (seller to you)
- You purchase the property from the seller at your contract price
- Funded by transactional funding (a same-day loan) or your own cash
- Deed transfers from seller to you (or your LLC)
Transaction 2: B-to-C (you to buyer)
- You sell the property to your end buyer at the higher price
- Buyer wires their funds to the title company
- Deed transfers from you to the buyer
- Transactional funding is repaid from the buyer's funds
- Your profit (the difference between the two sale prices minus costs) is disbursed to you
Why use a double close
- Your fee is private. The seller only sees Transaction 1. The buyer only sees Transaction 2.
- Works when the purchase contract prohibits assignment
- Necessary for REO properties and some MLS transactions
Extra costs
- Two sets of closing costs ($2,000-$5,000 total)
- Transactional funding fee (1-3% of purchase price)
- Two title insurance premiums
Timeline from contract to closing
| Stage | Timeline | Who Does It |
|---|---|---|
| Contract signed with seller | Day 0 | You and seller |
| Contract sent to title company | Day 0-1 | You |
| Title search begins | Day 1-3 | Title company |
| Deal marketed to buyers | Day 0-3 | You |
| Buyer identified and assignment signed | Day 3-10 | You and buyer |
| Title search complete | Day 5-10 | Title company |
| Closing documents prepared | Day 10-12 | Title company |
| Buyer wires funds | Day 12-14 | Buyer |
| Closing and signing | Day 14-21 | All parties |
| Recording and disbursement | Day 14-22 | Title company |
Total time from contract to your payment: typically 14 to 30 days. Fast closings (7-10 days) are possible with cash buyers and investor-friendly title companies.
What to bring to closing
- Government-issued photo ID: Driver's license or passport
- Your LLC documents: If closing in your entity's name, bring articles of organization and operating agreement
- Void check or wire instructions: For receiving your assignment fee
- Nothing else: The title company prepares all documents
Common closing problems
- Wire delays: Bank wires can take hours. Ensure your buyer sends funds at least one business day before closing.
- Last-minute title issues: A lien discovered late can delay or kill the closing. Order title work early.
- Seller no-show: Some sellers get cold feet at the last minute. Stay in communication and confirm their attendance 24-48 hours before closing.
- Name discrepancies: If the name on the contract does not match the name on the deed or ID exactly, it can cause delays. Verify all names match early in the process.
Choosing a title company
Not every title company handles wholesale transactions. You need an investor-friendly title company that is comfortable with:
- Contract assignments
- Double closings / simultaneous closings
- Transactional funding
- Fast turnaround (7-14 day closings)
- LLC entity closings
Bottom line
A wholesale closing is simpler than most people expect. In an assignment, the title company handles everything and you get paid from the buyer's funds. In a double close, two transactions happen back-to-back with your profit protected between them. Build a relationship with an investor-friendly title company and your closings will run smoothly.