Double Close vs Assignment
Assignment and double closing are the two common ways to get paid on a wholesale deal without renovating the property yourself. Neither is always better. The right choice depends on your contract, your spread and the people at the table.
This page compares the two honestly, including the cases where an assignment is the cheaper and simpler answer.
What an assignment is
With an assignment, you sign a purchase contract with the seller and then assign your right to buy to your end buyer for a fee. There is one transaction: the end buyer closes directly with the seller, and your assignment fee appears on the paperwork both sides can see.
Because there is only one closing and no funding involved, an assignment is usually the cheapest way to complete a wholesale deal when the contract and the parties allow it.
What a double closing is
With a double closing, you actually buy the property and then resell it in a second transaction, usually on the same day. Transactional funding is requested for the purchase side, subject to review and written terms. The purchase and resale have separate settlement statements, but that does not guarantee confidentiality or remove disclosure duties.
The full sequence, including how the Chicago Metro title companies coordinate the two files, is covered in how double closing works in the Chicago Metro.
Side by side
| Question | Assignment | Double Closing |
|---|---|---|
| How many transactions | One | Two, back to back |
| Where your profit shows | As an assignment fee both sides can see | As the difference between two separate closing statements |
| Funding cost | None | Transactional funding fee per the published schedule |
| Contract restrictions | Blocked when the contract prohibits assignment | Requires review of both contracts and applicable rules |
| Cash required | Confirm earnest money and settlement costs | Depends on approved funding terms and settlement costs |
| Best fit | Cooperative parties, modest spread, assignable contract | A purchase and separate resale that the advisers and closing office confirm can proceed |
When an assignment is usually enough
If your contract allows assignment, your spread is modest, and the seller and end buyer are comfortable with the structure, an assignment is typically the cheaper and simpler path. You avoid the funding fee and one set of closing paperwork.
Many wholesalers default to assignment for exactly these reasons. There is no reason to pay for a double closing when the deal does not need one.
When a double closing fits better
A double closing tends to fit when the spread is large enough that a visible assignment fee could create friction with the seller or the end buyer. A restriction on assignment does not automatically authorize a double closing. Ask qualified advisers and the closing office to review the proposed structure and disclosure requirements.
The cost of that flexibility is the transactional funding fee, which follows the published schedule on the transactional funding fees page. Underwrite the fee into your offer so the deal still works after the cost.
Common questions about the choice
Can any contract be assigned?
No. A contract may restrict or prohibit assignment. Have the closing office or your agent check the assignment language in your specific contract before you count on either structure.
Is a double closing more expensive than an assignment?
A double closing adds the transactional funding fee, which follows the published schedule, and each transaction can carry its own closing costs, like title insurance and the county recording fees on each transaction. An assignment avoids the funding fee. The tradeoff is that the assignment fee is visible to both sides, which can create friction on larger spreads.
Which structure is faster?
The timelines are similar when the paperwork is complete. An assignment can involve slightly less paperwork because there is one transaction, while a double closing coordinates two files through the same closing office. The closing office can confirm the sequence once it reviews both contracts.
Do I need an LLC for a double closing?
Wholesalers close in both personal names and entities. If you buy through an LLC, the closing office will want the entity documents for the file. The choice of entity is a question for your own legal and tax advisors.
Can I switch from an assignment to a double closing mid-deal?
That depends on your contract and where the file stands. If the contract restricts assignment or a party objects to the visible fee, a double closing can sometimes still work if the timing allows. Raise it with the closing team as early as you can.
Have a deal that needs a double closing?
Submit the deal and we will review the numbers. Funding depends on review of your contracts and closing arrangements.
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