96k in, 122k out, and transactional funding is a complete blank to me

Short term money still gets me lost, so I'll only say the part I'm sure of. Transactional funding is a loan for hours, not months, so it's priced as points plus a flat fee instead of an interest rate you'd recognize. Someone else should give you real numbers because mine would be a guess.

Numbers as stated. 26,000 gross. Two points plus a fee on a 96,000 first leg is somewhere around 2,700 if the quote is typical, and the second set of closing costs on 122,000 lands maybe 1,500 to 2,200 depending on your state, including whatever transfer tax your state charges per deed and whether the owner's policy on the second leg gets a reduced rate. So call the structure 4,200 to 4,900 and you keep 21,000 or so.

What's wrong with those numbers is that I invented the funding quote. Get two real ones before you decide anything, and make sure the second closing estimate comes from the closer you'd actually use, in writing, with transfer tax spelled out.

Worth asking your attorney about one thing while you're at it. In my state the rules on marketing or selling a contract you don't own got tightened, and taking title as the actual owner is a different posture than assigning. Whether that's true where you are depends on your state's statute and I'm not qualified to tell you. It's a fifteen minute call and it might change which structure you pick for reasons that have nothing to do with the 4,500.

Here's how the plumbing works, in order, since that's what you're missing.

You keep your contract with her at 96,000. What you need in it is the right to record the deed in your own name or an entity you control, and no clause that prohibits assignment or resale. Have the closer read it.

Two closings, same morning, same office. Closing one, funding money comes in, she deeds the property to you, she gets her check. Closing two, an hour later, you deed it to your buyer, his 122,000 comes in, the funder gets paid back out of it, and what's left is yours. Two settlement statements. He sees his. She sees hers. Neither sees the other, unless you're in a state that requires the profit disclosed anyway, Oklahoma being the one people mention.

The cheaper version: ask your closing office whether they'll close both legs using your buyer's funds, so you bring nothing. That's the simultaneous or dry close. Whether they'll do it comes down to their title underwriter's rules about moving one party's money into another party's closing, so it's a yes or no from that office and a different office in your state may answer differently. Ask that question first, this week, because if it's yes your 4,500 drops to maybe 1,800 and the decision makes itself.

For funders, ask the closer who they've worked with. They know, and their referral will already understand your closer's paperwork.

@lantern that order of operations is the clearest version of this I've read. The part I hadn't understood until now is that the second closing is what repays the first. It's the same money passing through twice.

Before you spend anything, confirm the buyer's money is real. A line he already has open is not the same as funds cleared and wired by 2pm on a specific Tuesday. Ask him for the lender's name and whether there's a draw request process with a lead time. If you've taken title with borrowed money and his draw takes three business days, you own a house and a clock.

You've been in that house forty times, which means you know things about it no inspector will find. If your client's aunt's roof is fine and the low 150s is real, 122 to your buyer is a fair number and he'll be back next year. The relationship is worth more than the 4,500 either way.

I'd think about it from the other side of the desk. If a contractor I've paid for five years brought me a house at 122 that pencils, and I later learned he made 26, my reaction would be that I should have been the one calling estates. Some buyers take it worse. You know him and we don't, so that's your call, but @quill's point stands.

The thing I find interesting here is that you got this deal because of the service business, not in spite of it. Forty visits and a client who trusts you. That's a sourcing channel most people would pay for.

Same background, and I'll say the unglamorous part. Whatever you keep, 21,000 or 26,000, it arrives once. Your crew revenue arrives every month. Don't structure this in a way that makes the monthly thing weird.

One more question for the closer while you have them on the phone: does your state charge transfer tax on each deed or once per transaction? Two deeds in some states means paying it twice, and on 96 plus 122 that can be a real number rather than a rounding error. It varies enough that guessing is pointless.

On the funding side, a one day loan priced at two points is a very high annualized rate and it still may be the right thing to buy, because you're renting the money for four hours to protect a 26,000 spread. Ask any funder what happens if the second closing slips a day, what the extension costs, and get it in writing. That answer tells you more about them than the points do.