Transactional Funding supplies money for an investor’s purchase of a property in order to immediately be resold to an end-buyer. It is a short-term funding to wholesalers. The money is usually used for less than a complete day as the investor closes with the seller and at the same time his end-buyer closes. It is also known as “double closing,”. The property seller is called “Party A.” The wholesaler is “Party B.” The end buyer of the property is “Party C.” Transactional Funding deals are also sometimes called “A-B – B-C” Transactions.
Our clients use our Transactional Funding Service for two fundamental reasons: 1. Sometimes people enter into contracts that are NOT ASSIGNABLE to a third party. This usually happens when you are purchasing properties on MLS, bank-owned properties, or properties owned by government entities such as HUD, FHA, Fannie Mae, etc. 2. The wholesaler chooses not to assign the contract in order to maximize their wholesale markup. The investor’s profit may be substantial and he doesn’t want the original seller or his end-buyer to know just how large it is. Once the investor has found a buyer, they can close the purchase with the seller and then sell to his end-buyer to make a profit. End buyers may decide not to purchase a property if the assignment fee is too high. When utilizing transactional funding, you do not have to disclose your purchase contract details to the end buyer.
The property seller is called “Party A.” The wholesaler is “Party B.” The end buyer of the property is “Party C.” Double Closing deals are also sometimes called “A-B – B-C” Transactions.
A Double Closing occurs if there is a purchase and sale of a property twice in the same day. If the A – B “leg” closes on one day and the B – C leg closes another day, “extended” Transactional Funding is required. This extended use of the money will be a hard money loan. It will then need a mortgage and note to secure the lender’s money. QuickTransactionalFunding.com does not offer extended funding or hard money loans.
A double closing allows a wholesale investor to protect the profit by keeping the purchase and subsequent sale to an end buyer as separate transactions. This prevents both the initial seller and the final buyer from knowing the profit margin.
No. There are no personal financial requirements to obtain Transactional Funding. We do not run your credit and do not require bank statements, tax returns, etc. Our qualifications are based on a review of your transaction's sales contracts and the title company(ies) agreement for our funding conditions.