I bought a house from a man who had owned it for forty minutes

Ha. I found out a different way. I was walking a flip I'd just bought and the roofer told me he'd already been through it two weeks earlier with "the other guy who bought it." Same house, same estimate, he still had the photos on his phone. Wholesaler had priced his exit off my roofer's number before I ever saw the listing.

The part I'd have gone looking for is the order of the two deeds. In a double close there are two conveyances that have to land in the right sequence, estate to the middle party first, middle party to you second, and the middle party's ownership only exists in the gap between them. Recording practice and how quickly the register acts on it vary by state, so ask the closer in writing how they handle sequencing and whether both instruments go out in the same batch. Not a hypothetical concern, that gap is where title problems live.

Had almost this exact thing on a four unit. Difference was the middle party told me up front. He said "I'm buying it at nine, selling to you at nine forty, my funding costs me about six grand for the day." I liked him more for saying it and I still bought at nine forty.

@verity did the estate know? That's the part I keep circling. They sold at a number, the buyer resold same day at a higher one, and nobody at their table saw your statement either.

Wait, he owned it for forty minutes. I didn't know that was a thing you could do.

I've done six of these. The spread reads bigger than it lives. On a low six figure house you're paying two sets of closing costs plus the day rate on transactional funding, and where I operate the transfer tax hits twice, which people forget until the statement prints. My last one showed twenty two thousand of gross spread and I kept a bit under thirteen. Still better than the assignment version, because the assignment version was going to be a conversation about my fee that I'd lose.

Forty minutes of ownership and zero maintenance calls, best landlord run I've ever heard of.

Worth saying for anyone reading who plans to go verify this on their own deals: prices aren't public everywhere. Roughly a dozen states don't disclose sale prices at all, so in those you'd see the two deeds and never the two numbers. @verity happened to be in a state that prints it.

The funding wire is the whole story on these. I had one where my funder wanted written confirmation the B side was clear to close before releasing, and the B buyer's lender wouldn't issue anything past 2pm on a Friday. We sat in a conference room until the two closers worked out an order they'd both sign off on. Made about nine grand and aged four years.

Honestly I've stopped caring about the middle party's number. If my rent, my capex line and my exit work at the price I signed, the spread is somebody else's business. What I do care about is who touched title in between and whether the policy covers it.

@keystone when you say the assignment version was a conversation you'd lose, is that mostly buyer psychology? Like the fee being visible is the problem more than the size of it?

Sorry, basic question, but where does the money for the first closing come from if he doesn't have it? Someone lends it to him for one day?

The closer's face is the best detail in this whole post.

@verity the thirty one thousand is only interesting if it tells you something you didn't know about the property. Did it? You underwrote at your price with a tenant in place and an eight year roof. If the estate's number implies the house was available at ninety and you paid one twenty one, the question is whether you could have sourced it at ninety, and the answer is no, because you weren't the one talking to the estate. That's the whole trade. What I'd actually want to know is his hold cost on the day, because if it was six grand on a thirty one grand spread he has room to keep doing this to you, and if it was eighteen he doesn't.

Closers hate the two file day. Two sets of wires, two sets of signers, one address, and everything has to hit in order. Half of them won't take the work at all and the ones who will have a process they can recite. Ask which one you've got before you set a date.

Out where I look, a thirty one thousand spread would be a third of the purchase price. Nobody's hiding that successfully. Down here the whole method mostly doesn't pencil once you pay for two closings.

@kestrel to your question about the fee being visible, there's a second reason people take title instead. Marketing a contract you don't own is what draws the licensing question in a lot of states, and buying and reselling as the actual owner changes the shape of what you're doing. How that lands depends entirely on your state's statute and you'd need a real estate attorney there to tell you, not a forum. I'm mid licensing course and it's the single thing my instructor is most careful about phrasing.