Quick Answer
Wholesalers should work with a title company familiar with assignments and double closings. Open title early, verify seller ownership, disclose the transaction structure clearly, and understand applicable state law including any restrictions on assignments or double closings.
Wholesaling involves unique title considerations because the transaction structure differs from a standard purchase. Whether the wholesaler is assigning the contract or doing a double closing, the title company needs to understand the structure and handle the fund flow correctly.
Open Title Early
Opening title early is especially important in wholesale transactions. The title company needs time to verify the seller's ownership, check for liens and other issues, and prepare for the specific fund flow the transaction requires.
Assignment or Double Closing?
Some wholesale transactions use an assignment, where the wholesaler assigns the purchase contract to the end buyer for a fee. Others use a double closing, where the wholesaler closes on the property and simultaneously sells to the end buyer. Each structure has different title implications, fund flow requirements, and potentially different legal considerations.
For more on double closings, see our double closing guide. For more on assignments, discuss the structure with your title company to confirm what documentation is needed.
State Rules Matter
State law can affect how wholesale transactions are structured. Some states have specific requirements or restrictions related to assignments, double closings, or wholesale transactions generally. Rules may vary by jurisdiction. Work with a title company familiar with the laws in the state where the property is located.
1st Option Title operates in Texas and Arizona. For transactions outside those states, contact 1st Option Title to discuss whether the team may be able to help coordinate your transaction depending on the property and jurisdiction.
Requirements may vary by jurisdiction and transaction. Consult qualified legal, tax, lending, or other professionals for advice on your specific transaction structure.