Simultaneous Closing vs. Double Closing: Is There a Difference?

Wholesaling becomes confusing when people start using terms that sound similar. Simultaneous closing, double closing… aren’t they just different ways to say the same thing? Nope. They’re actually super different, and mixing them up could tank your deal before you even get started.

One method lets you skip bringing your own money to the table. The other requires that you have funding lined up. Let’s examine their differences so you know which one best fits your situation.

What is a Simultaneous Closing?

A simultaneous closing occurs when both transactions take place at the exact same moment. Your buyer’s money is deposited and immediately paid to the seller. You’re just in the middle, making it happen.

How Do Simultaneous Closings Work?

You get a property under contract with a seller, then you find your buyer who’ll pay more. On closing day, your buyer brings their cash, and the title company uses it to pay the original seller. Both deals close using the same funds. You walk away with the difference.

The whole thing takes maybe an hour, and you never actually needed your own money in the deal. It’s ideal, except most title companies won’t touch this anymore because it makes them nervous.

The A-B-C Transaction Structure

Party A is the seller, Party B is you, and Party C is your buyer. The money flows from C to B, then to A, all at once. The property jumps from A to B to C so quickly that you barely own it. But on paper, yes, you were technically the owner for a hot second.

That’s why it works for keeping your profit private, since the seller and buyer never see each other’s numbers.

What is a Double Closing in Real Estate?

Double closing means you’re doing two completely separate transactions. First, you purchase the property from the seller using your own funds. Then you turn around and sell it to your buyer.

The Double Closing Process Step-by-Step

First, you lock down your seller with a contract. Then you find your buyer and get them under contract as well. You need actual funding to close that first purchase here. It could be a hard money loan, transactional funding, or your own cash, if available. You close with the seller, and you own the property.

Then you close with your buyer, and their money pays off your loan. Meanwhile, you pocket the profit. There will be two separate closings and two sets of paperwork. There’s way more paperwork than simultaneous, but also way easier to find title companies who’ll do it.

Back-to-Back vs. Same-Day Closings

Back-to-back means you close both deals consecutively. For example, once you’ve finished signing with the seller, grab a coffee and sign with your buyer. Same-day simply means that both closings occur before midnight, although there may be a few hours in between.

The difference matters for funding costs, though. Back-to-back is usually cheaper because your lender’s money is only tied up for an hour or two. Either way, you’re bringing your own funding to that first closing, which is what separates this from simultaneous.

Simultaneous Closing vs Double Closing: The Key Differences

Now you know what each one is, let’s get very specific about what actually separates these two strategies.

Funding Methods

This is the biggest difference. With simultaneous closing, your buyer’s cash does all the heavy lifting. You’re basically just coordinating. With a double closing, you must come up with actual money to purchase the property first. These are hard money loans, transactional funding, or straight cash, if available.

Your buyer’s money doesn’t come into play until the second closing happens. That’s why double closing costs more upfront, but also why it’s way easier to find people who’ll work with you on it. KP Close can help make the whole process simple and stress-free.

Timeline and Deed Recording

In a simultaneous closing, both deeds get recorded back-to-back, like within minutes of each other. It’s all happening in one big coordinated push.

For double closing, the first deed gets recorded when you buy from the seller. Then, later (which could be an hour or that afternoon), the second deed is recorded when you sell to your buyer. Two separate entries in the public record.

That gap matters because it means you actually owned the property, even if it was only for a short time.

Transparency Between Parties

With simultaneous closing, nobody really knows what everybody else is getting paid. Your seller doesn’t see your buyer’s purchase price, and your buyer doesn’t know what you paid the seller. Your profit stays private.

With double closing? Everything’s in the public record eventually. Someone motivated enough can look up both transactions and do the math on your spread. Some wholesalers are concerned about this, while others are not. It all depends on your market and the strength of your relationships.

Advantages of Simultaneous Closings

There are several reasons why some people prefer simultaneous closing, despite its increased difficulty in execution lately.

No Transactional Funding Required

You don’t need to line up a lender or have cash sitting in your account. You also don’t need to qualify for anything or worry about your credit score. Your buyer brings the money, and that same money pays everyone.

It’s strategic when it works because you’re literally closing deals with zero dollars of your own. That means you can do more deals faster without worrying about how much capital you’ve got available.

Lower Overall Costs

One closing means one set of closing costs. You’re not paying double title fees, recording fees, or any other additional costs. Additionally, you won’t pay interest on transactional funding. Even if it’s just for a few hours, that stuff adds up.

The savings might not seem huge on one deal, but doing ten deals can suddenly add up to thousands more. And since you’re not bringing funding to the table, you also won’t have to deal with loan origination fees or points.

Speed and Simplicity

Simultaneous closing is really fast when everything aligns right. There would only be one appointment and one set of signatures. Your buyer shows up with money, and everyone signs papers. You just walk out with your check.

Since the whole thing wraps up in an hour, there’s also less time for things to go wrong and less time for people to get cold feet. You don’t have to sit around worrying if the deal’s gonna fall through.

Disadvantages of Simultaneous Closings

There’s a reason most people no longer use this method, though. Here are some of the reasons why.

Limited Title Company Participation

Most title companies straight-up refuse to do simultaneous closings these days. They view it as risky and worry about liability. They also don’t want to deal with the tight coordination required. You might call twenty title companies before you find one that’ll even consider it.

And the ones that do? They’re gonna charge you more and probably make the whole process longer. Some markets have zero title companies willing to touch this type of closing. That alone can kill the strategy before you even start.

Reduced Availability Post-2008

After the housing crash, everything got way more regulated. Lenders, title companies, and insurance companies got nervous. The entire industry decided that simultaneous closings looked too suspicious and that there was considerable room for fraud. 

So, even though it’s technically legal in most places, finding anyone willing to facilitate it has become nearly impossible. Some old-school investors who’ve been doing this since the early 2000s can still find their connections, but if you’re new, it’s a little harder.

The industry has largely moved away from this model, and it doesn’t appear to be a viable option anytime soon.

Advantages of Double Closing

Many wholesalers prefer double closing these days, and for good reason.

Complete Privacy Protection

The biggest draw for many people is that the seller never sees what the buyer is paying. Your buyer never sees what you paid the seller, either. Sure, everything ends up in public records eventually, but most people aren’t patient enough to look through county databases to reverse-engineer your deals.

Each transaction stands alone, with its own purchase price and accompanying documents. If you want to make a $30k spread on a deal, your buyer just sees their purchase price, while your seller just sees theirs. Nobody’s feelings will get hurt, and they will call you up asking why you made so much money.

That buffer matters when you’re working with people who might not fully understand wholesaling. Contact us today. KP Close can guide you through the process and make it easier.

Greater Profit Margins for Wholesalers

Double closing lets you charge more. When your buyer doesn’t know what you’re paying the seller, you can work with bigger spreads. You’re not stuck explaining your fee or justifying why you deserve $25k to connect two parties. The privacy gives you negotiating room.

Additionally, you can add value to the property between closings if desired. If you have a few hours, you can handle that quick repair or get permits lined up. Now you’re not just a middleman; you’ve actually done something.

That justifies higher margins and makes the whole thing feel less like you’re just skimming off the top.

More Acceptable to Title Companies

If you call up any title company and ask about double closing, they’ll probably say yes. But ask about simultaneous closing? Crickets.

Double closing looks normal to them. It’s two separate real estate transactions that happen to be on the same day. They’ve got separate funding sources, documents, and everything. There’s no weird coordination where one buyer’s money pays everyone.

The title company doesn’t seem to be facilitating anything suspicious. They’re just closing properties, which is literally their job. That accessibility alone makes double closing the default choice for most wholesalers.

Disadvantages of Double Closing

Double closing isn’t perfect either. There are a few reasons why you might want to look the other way.

Higher Closing Costs

With double closing, you’re paying for two closings, title fees, recording fees, and transfer taxes in some states. There are always two sets of everything, which can be very expensive.

A closing that would cost you $800 in fees will amount to $1,600 with a double closing, maybe more, depending on your state. You’re also paying interest on whatever funding you used for that first purchase.

Transactional funding may be 2% to 3% of the purchase price, even if you only borrowed it for a short period, such as two hours. For hard money, it’s even higher.

Those costs eat into your profit margin before you even calculate your wholesale fee. You need bigger spreads to make the same net profit.

Need for Transactional Funding

Some newbies usually get stuck here. You need actual money to close that first purchase. If you don’t have $100k sitting around, you’re likely to call transactional funders or hard money lenders.

Of course, the funder wants to make sure you’re not about to stick them with a property they can’t unload. Some funders require your buyer to be pre-approved or show proof of cash before they’ll fund your purchase. It’s not complicated exactly, but it involves an extra step.

If your buyer backs out at the last minute, you’re now stuck owning a property with borrowed money and a ticking clock.

More Complex Documentation

Two closings mean two complete sets of paperwork, two settlement statements, two title policies, two sets of signatures, and two rounds of reviewing documents to make sure nothing’s screwed up.

Your closing agent is managing twice as many moving parts. And more documents mean more opportunities for mistakes. One wrong number on one form and you’ll be stuck at the closing table fixing paperwork while everyone’s getting annoyed.

Plus, you’re signing your name about a million times. Okay, not literally a million, but it feels like it when you’re closing both sides on the same day. Some people don’t mind the extra paperwork, while others hate it.

When to Use Each Closing Method

You should use simultaneous closing when you have a title company that actually offers this service and you want to keep costs extremely low. If you’re working with tight margins or literally don’t have access to funding, simultaneous might be your only play. Just know you’re gonna spend forever finding someone to close it.

Use double closing for essentially everything else. It’s become the standard because it’s reliable and accepted everywhere.

The extra costs suck, but the reliability makes it worth it. Most experienced wholesalers default to double closing unless there’s a specific reason not to.

Finding Title Companies That Handle These Closings

You should start by asking other investors in your market. Attend local real estate meetups and obtain the specific names of title companies that perform double closings for wholesalers. Other investors will tell you straight up who works and who doesn’t.

Call around and be direct about what you’re doing. Say, “Hey, I’m a real estate investor and I need a title company experienced with back-to-back closings.” If they immediately say yes and know what you’re talking about, you’ve found someone good.

Additionally, establish relationships with investor-friendly title companies and present them with multiple deals. Having two or three great companies as options is beneficial.

Assignment of Contract vs. Double Closing

Wait, there’s a third option? Yep. And it’s way simpler than both of the others if you can pull it off.

With an assignment, you never actually buy the property. You obtain the contract under contract with the seller, then you sell your rights to that contract to your end buyer. It’s like concert tickets. You bought the right to go, now you’re selling that right to someone else.

Your buyer steps into your shoes and closes directly with the seller. You just collect an assignment fee and walk away. It’s super clean and simple. It’s also significantly cheaper than double closing, as there’s only one actual closing happening.

So, why doesn’t everyone just complete their assignments? Well, it’s because some sellers really hate it. They feel deceived when they discover you’re not the actual buyer. They see your assignment fee and lose their minds about how much you’re making.

Plus, your buyer sees exactly what you’re paying the seller, which means they know your spread. Some buyers may attempt to bypass you and deal directly with the seller. Additionally, many lenders do not allow assignments. They want the person on the contract to be the person closing.

If your buyer requires financing, an assignment is unlikely to be effective. Double closing fixes all these problems by keeping everyone separated and making you the actual owner, even if it’s just for an hour.

Key Takeaways: Simultaneous Closing vs. Double Closing

What you really need to remember is that simultaneous closing uses your buyer’s money for everything, so you’re not bringing cash to the table. Meanwhile, a double close means you actually buy the property first with your own funding before selling it to your buyer. Simultaneous sounds amazing until you try finding a title company that’ll actually do it (good luck with that). Double closing costs more upfront, but at least it’s realistic and doable.

Need funding for your next double closing? That’s literally what we do at KP Close. We fund over 15 deals every month! You simply send us your contracts, and we review the deal. We then wire you the money. Please call us at (843) 823-1148 or complete the form below. Don’t let good deals fall apart because you’re stuck waiting on funding.