Double Closes Explained

The basic structure

The first contract is commonly called the AB contract: Seller A sells to Buyer B. The second is the BC contract: Buyer/Seller B sells to End Buyer C.

Why investors use a double close

• The investor wants to take title rather than assign the original contract.
• The assignment fee would be unusually large or sensitive.
• The buyer or seller prefers a traditional purchase-and-sale structure.
• The investor wants the two contracts treated as separate transactions.

Where transactional funding enters

In many same-day double closes, short-term capital may fund the AB purchase long enough for the BC closing to occur. The BC proceeds then complete the transaction and repay the short-term capital according to the funding agreement.

What has to line up

• Both contracts are valid and fully executed.
• Title is ready to close both transactions.
• The end buyer's money is verified and available when required.
• All signatures and closing documents are complete.
• The title company understands the sequencing.
• The funding provider approves the deal structure.

Same-day timing matters

A double close is not just “two contracts.” It is a coordinated closing process. If the BC side is delayed, the AB funding may be exposed longer than expected. That is why funders care so much about timing and proof that the end buyer is ready.

Assignment vs. double close

With an assignment, the wholesaler transfers contractual rights to another buyer. With a double close, the investor actually buys and then resells. Neither is automatically better; the right choice depends on the contracts, economics, local rules, title company, disclosure requirements, and parties involved.

Educational information only. Deal Support Network does not provide legal, tax, investment, or financial advice. Funding availability and terms depend on the specific transaction and provider.