Both assignment contracts and double closings can move a wholesale deal to an end buyer, but they are not interchangeable. The right choice depends on your state's rules, what the seller's contract allows, what your end buyer needs, and how much of your fee you want to disclose.
Key takeaways
- An assignment transfers your purchase contract rights to an end buyer for a fee; a double close uses two separate transactions to move the property from seller to you, then from you to the end buyer.
- Assignment is simpler and cheaper, but your profit is visible to all parties and some sellers or contracts prohibit it.
- A double close keeps your margin private and closes like a normal sale, but it costs more and requires funding for the middle leg.
- Rules governing both structures vary meaningfully by state, so what is standard in one market may be restricted or require a license in another.
- Consult a local real estate attorney and your state real estate commission before structuring any wholesale deal.
What an assignment actually does
When you sign a purchase contract with a seller, you hold equitable interest in that property for the contract period. An assignment transfers that interest, along with your rights and obligations under the contract, to an end buyer. You collect an assignment fee at closing, and the end buyer steps into your shoes and closes directly with the seller.
The mechanics are straightforward. You and the end buyer sign a separate assignment agreement that spells out the fee and any conditions. Your title company or closing attorney handles the paperwork. The seller may or may not need to consent, depending on how the original purchase contract is written and on state law.
The main exposure with an assignment is transparency. The assignment fee typically appears on the closing disclosure, so the seller and the end buyer can both see what you are making. In some deals that creates friction. Sellers who feel the gap is too large occasionally try to back out or renegotiate. Some purchase contracts contain anti-assignment clauses that block the move entirely. Read the contract before you sign it and understand what you are agreeing to.
Assignment is also state-specific in ways that matter. Some states classify certain assignment activity as brokering real estate, which may require a license. Rules change, and they differ by state. Before relying on assignment as your primary structure, verify current requirements with a licensed attorney in your state and check with your state real estate commission.
What a double close actually does
A double close involves two sequential transactions. In the first, you purchase the property from the seller using a normal purchase contract. In the second, you sell the property to your end buyer. You briefly hold title between the two closings, sometimes for only a few hours.
Because these are two separate sale transactions, your profit is the difference between your purchase price and your sale price, not a named fee on a single closing disclosure. This keeps your margin private, which matters when the spread is large or when you are working with sellers who might object to seeing the number.
The structural challenge is funding the first leg. You are buying the property, even temporarily, so you need money to close. Some investors use transactional funding, which is short-term lending specifically designed for back-to-back closings. The cost of that funding, plus two sets of closing costs, makes a double close more expensive than an assignment. Factor that into your numbers before choosing this route.
Title can also be more complex. Some title companies are uncomfortable with same-day or next-day double closings, particularly when the end buyer's lender is involved. A few lenders have seasoning requirements that affect how quickly you can resell a property you just purchased. Confirm your title company and any lender on the end-buyer side are comfortable with the structure before you proceed.
Like assignment, the rules around double closings vary by state. Some states have specific disclosure requirements or waiting periods. Others treat them as routine. A local real estate attorney can tell you what is standard practice and what is restricted in your market.
Choosing based on the deal, not habit
Neither structure is universally better. A few factors that commonly point toward one over the other:
Spread size and privacy. If the assignment fee is modest, visibility is rarely a problem. If the margin is large relative to the purchase price, a double close avoids potential friction with the seller or end buyer.
What the contract allows. If the seller's purchase contract prohibits assignment or requires seller consent, a double close may be your only clean option. If the contract is silent or explicitly allows assignment, assignment is simpler.
Your end buyer's financing. Cash end buyers are generally flexible. End buyers using conventional financing may face lender restrictions around title seasoning or back-to-back transactions. Know your end buyer's financing situation before you commit to a structure.
Your own licensing status. In some states, the way a deal is structured can affect whether you are operating within or outside the bounds of real estate licensing law. This is one of the most jurisdiction-specific areas in wholesaling, and it is not something to guess about. Your state real estate commission publishes guidance, and a local attorney can apply that guidance to your specific situation.
Cost. A double close carries two sets of closing costs plus transactional funding if you need it. On a thin deal, those costs can eliminate the margin. Run the numbers before you decide.
What your end buyer needs to see
Regardless of structure, end buyers evaluating a wholesale deal want to understand the property's condition, a reasonable estimate of after-repair costs, the asking price relative to what the market will support after repairs, and clear title. The after-repair value and the common rule-of-thumb ceiling on what to pay relative to that value are analytical tools, not guarantees. Every market and deal differs.
Be straightforward with your end buyers. If there are title issues, disclose them. If the property has known defects, say so. Buyers who feel misled do not come back and often tell others. A reputation for honest deal flow is worth more than any single transaction.
CoreVest Acquisitions builds its member network around public county records, including tax-delinquent filings, to surface distressed property before it hits the open market. The goal is to give investors a consistent pipeline to underwrite and act on.
Earnest money and protecting yourself
Earnest money in a wholesale context serves the same purpose it does in any purchase: it signals commitment and is at risk if you default. Keep earnest money amounts realistic for your market and your ability to close or assign. Inflated deposits you cannot back up create problems if the deal falls through.
If you are assigning, make sure your assignment agreement addresses what happens to earnest money if the end buyer fails to close. Your original purchase contract with the seller may hold you responsible regardless of what the end buyer does. Structure accordingly.
On the paperwork side, CoreVest TC is a separate product we offer that helps coordinate deadlines, documents, and closing timelines across a deal, which is particularly useful when you are running multiple transactions and managing time-sensitive contract periods.
What to do next
Before structuring your next wholesale deal, determine whether your state treats certain assignment or double-close activity as real estate brokering. Talk to a local real estate attorney and review your state real estate commission's guidance. Confirm your title company handles your preferred structure routinely. Get your end buyers' financing situation clear before you commit. And if you plan to contact property owners directly, check current Do Not Call registry rules and texting regulations before reaching out.
This is general educational information, not legal, tax, or investment advice. Rules and markets vary by state and by deal, so consult a licensed attorney, your state real estate commission, and your own advisors before acting.