Double Close Cost

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How to use the Double Close Cost

1
Enter both prices
Your contract price with the seller and the price your end buyer will pay you.
2
Add the funding fee
Transactional lenders fund your purchase for a few hours and charge a fee, often 1–2% of the price.
3
Add both sets of closing costs
In a double close you pay costs as a buyer and again as a seller.
4
Compare with an assignment
Enter any attorney or title fees you'd pay to assign the contract instead.

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In a double close, a wholesaler buys the house from the seller and resells it to the end buyer, usually on the same day. It keeps your spread private and works when a contract can't be assigned, as with many bank-owned homes. But you pay two sets of closing costs and often a transactional funding fee. This tool shows what that costs compared with a simple assignment.

Worked example

A wholesaler has a contract at $195,000 and an investor ready to pay $207,000, a $12,000 spread. Transactional funding costs 1.5% of the purchase, closing costs as a buyer 1.5%, and closing costs as a seller 1% of the resale price.

The double close costs about $7,900, leaving the wholesaler about $4,100. Assigning the contract with $500 in fees would leave $11,500.

To net the same with a double close, the wholesaler would need to sell to the investor for about $214,500, a spread of about $19,500.

The formula

Spread             = Price to end buyer − Price from seller
Double close costs = Seller price × Funding % + Seller price × Buying costs %
                     + Buyer price × Selling costs %
Double close net   = Spread − Double close costs
Assignment net     = Spread − Assignment costs
Price to match     = (Assignment net + Seller price + Funding + Buying costs) ÷ (1 − Selling costs %)

Common mistakes

Forgetting transfer taxes. In some states transfer taxes are charged on both closings. Include them in your closing costs.
Assuming the end buyer's money can fund your purchase. Many title companies won't use the end buyer's funds for the first closing. Confirm before you rely on it.
Skipping legal advice. Several states regulate wholesaling and require disclosures. Ask a real estate attorney.

Questions people ask

When is a double close worth it? When the contract can't be assigned, when a large visible fee might scare off the buyer or the seller, or when the spread is big enough that the extra costs don't matter much.

Who pays the closing costs? It depends on the contracts and local custom. Enter only the costs you'll actually pay.

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