Buy REOs with Transactional Funding

About the author : Dave Dinkel

The short answer to using transactional funding to buy lender REOs (Real Estate Owned) properties is “sometimes.”


When a lender forecloses, he must have a local attorney do the legal work to get the final judgment and sale date from the court and then they get these recorded in the public record.

Lenders are typically cheap because they don’t want to get properties back and pay maintenance costs, carrying charges, losing interest on their funds, and having repair issues.

These lenders usually promise the foreclosing attorney he can do the closing for a buyer when the time comes.

This sale to a buyer happens because the lender got the property back from the foreclosure sale because there were no bids that were acceptable to the lender.

These foreclosing attorneys, in my experience, have never been “investor-friendly” if an investor is trying to assign their contract or double close on the property.

There may be rare exceptions, but these attorneys have a fiduciary duty to the lender to notify him of the resale of the property at closing.

The lender will not allow you to do a wholesale flip and take out a profit that they believe belongs to them.

However, you can do a double closing, rarely an assignment, at an investor-friendly closing agent who doesn’t have to report to the lender who is now on the title and is the seller.

Occasionally, the lender’s attorney will do the A-B closing and an investor-friendly closing agent will do the B-C the following day or as soon as the deed from the lender is recorded and you are on title.

There can be great deals that are foreclosed properties but it’s very important to choose the closing agent if you intend to do a wholesale flip.

Usually, being able to choose the closing agent can be done by asserting your right to choose by paying for the title work, including the title insurance.

The cost is insignificant compared to the risk you have of losing the deal to an uncooperative closing agent/attorney.


If you have any additional questions, contact me directly at

If you need hard money instead of transactional funding, contact me for referrals to private hard money lenders.

Be sure to check out for all your same-day double closing needs, including a list of Investor-Friendly Closing Agents in various states.

We have more five-star Google ratings than all the other transactional funders combined.

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About the author : Dave Dinkel