Double Closings on MLS · The Cowboy Sales Process

The Cowboy Sales Process

Understand the extreme risks of double closing MLS deals with retail buyers.

Analyze real-world case studies of catastrophic failures in double closings.

Master the strategic framework for deciding between a double close, a novation, or walking away.

Implement battle-tested tactics to mitigate risk and protect your capital.

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Intel Briefing: The Allure and the Ambush of the Double Close

Double closing is a powerful tool in a real estate investor's arsenal. It allows you to use your end-buyer's funds to finance your purchase from the original seller, while keeping your profit margin (your "spread") private. It sounds clean. It sounds simple. And when dealing with properties sourced from the Multiple Listing Service (MLS), it can be a financial ambush waiting to happen.

MLS deals attract retail buyers—individuals relying on fragile bank financing—not hardened cash investors. This fundamentally changes the risk equation. The strategies that work for off-market deals with cash buyers will get you slaughtered here. This document dissects that risk and gives you the playbook to navigate it.

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Section 1: The Core Risk - The Retail Buyer Fallacy

The central point of failure in an MLS double close is the instability of retail buyer financing. Even after a buyer's due diligence and contingency periods have expired, their loan can be torpedoed by underwriting at the last second.

As the speaker makes brutally clear, once you close the first leg of the transaction (the "A-to-B," where you buy from the original seller), you are the legal owner. If the second leg (the "B-to-C," where you sell to the retail buyer) collapses, the property is now your problem. A deal you intended to hold for two hours can become a multi-year nightmare.

Let's examine the financial carnage through two real-world case studies from the video.

Case Studies

Case Studies

Case Study #1: The 14-Month Nightmare

Column 2

Case Study #2: The Phantom Approval & The $20,000 Loss

Column 2

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Section 2: The Strategic Playbook - Execution & Risk Control

Understanding the risks is one thing; controlling them is another. Here is the tactical framework for making the right decision under pressure.

Table

Table

Name

Notes

Rule #1: The Buyer Test - Cash vs. Financing

Open

Rule #2: The Backup Offer Mandate

Open

Rule #3: The EMD Hedge (Earnest Money Deposit)

Open

There are no rows in this table

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Section 3: Lender-Specific Hazards

Be aware that certain loan types make double closings difficult or impossible.

FHA Loans: Off the table. FHA has a strict "seasoning period," which prevents a property from being resold within a short timeframe (typically 90 days). A double close violates this directly.

Conventional & VA Loans: While technically possible, many conventional lenders and banks are hostile to same-day double closings. This institutional friction increases the probability of a last-minute failure, forcing you into an unwanted hold.

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Final Briefing: Match the Weapon to the War

The critical failure described in the video wasn't a failure of wholesaling; it was a failure of strategy. It was using a tool—the double close—in a scenario for which it is ill-suited.

Use double closings for defense: Protect large spreads from sellers when dealing with reliable cash buyers.

Use novations for offense: Safely and efficiently structure deals with less-reliable financed retail buyers.

Never proceed with a retail-buyer double close unless you have overwhelming leverage in the form of multiple, high-profit backup offers.

The market doesn't care about your intentions. It only rewards correct execution. Analyze the buyer, assess the financing risk, and choose your deal structure accordingly.

Struggling to find consistent deals? Prexium connects you with the opportunities you’ve been missing. Get started now 👉

The Cowboy Marketer⁠

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