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SIMULTANEOUS CLOSINGS:
THE HOTTEST NEW
REAL ESTATE SALES TOOL
Simultaneous Closings are the new hot item in the
real estate industry. What is a Simultaneous Closing? It
is when a home seller creates a note for the buyer to
facilitate the sale of his property, and then sells the
note to an investor at the same time.
The Simultaneous Closing is nothing more than
creative financing. We all know that it is much easier
to sell real estate if owner or seller financing is
available. However, most sellers do not want to take
back financing. They do not want to play the role of a
bank, but if the seller can take back financing long
enough to create a note, that note can be sold to an
investor, allowing the seller to cash out of his
property. Here’s how it works.
Say a seller has a property he’s been trying to
sell for months at $100,000 and no buyers have surfaced.
With a simultaneous closing, the seller can advertise
the property as owner financing with no need to bank
qualify. This will create an abundance of buyers.
Working with an investor, the seller finds a buyer who
is able to put $20,000 down and agrees to take back the
balance of the financing, subject to being able to sell
the note. With the buyer of the property identified and
the conditions of the note agreed upon, the investor
buys the note from the seller once the note has been
created. Here's what it looks like:"
Sale Price $100,000
Down Payment from buyer $20,000
Note created by seller $80,000
Amount supplied by the investor to purchase the note $72,000
Total amount to the seller $92,000
The seller gets $20,000 down and $72,000 from the
sale of the note, for a total of $92,000. Although the
owner didn’t receive the full asking price for the
property, he still sold for a good price. In fact, the
seller probably would have sold his property a hundred
times if he got an offer for $92,000. Of course, if
there were any liens on the property, they would have to
be paid off with the proceeds of the sale.
Simultaneous Closings are a great tool for people
trying to sell their homes. Buyers can be identified
quickly and, by working with an investor or funding
company familiar with simultaneous closings, the whole
process can be a quick and easy method of selling a
property.
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