When comparing assignment vs double closing, wholesalers often ask one question: which strategy produces the highest profit?
Consider a simple example. A seller agrees to sell a property for $120,000. A cash buyer is willing to pay $135,000.
The wholesaler now has two options:
- Assign the contract and earn a $15,000 assignment fee
- Complete a double closing and potentially earn $25,000+
Both strategies work. However, they involve different levels of risk, capital, and transparency.
If you’re new to the process, start by learning the fundamentals of assigning a real estate contract.
Assignment Example: A $15,000 Wholesale Fee
In an assignment deal, the wholesaler sells the purchase contract to a buyer instead of purchasing the property themselves.
- Contract with seller: $120,000
- Buyer purchase price: $135,000
- Assignment fee: $15,000
The buyer closes directly with the seller. Meanwhile, the wholesaler earns the assignment fee for finding the opportunity.
Double Closing Example: A $25,000 Spread
In contrast, a double closing involves two transactions.
- A → B: Seller sells property to wholesaler
- B → C: Wholesaler sells property to buyer
- Purchase price: $120,000
- Resale price: $145,000
- Total profit: $25,000
Because the wholesaler temporarily owns the property, the buyer never sees the original contract price.
Assignment vs Double Closing: Key Differences
| Feature | Assignment | Double Closing |
|---|---|---|
| Ownership required | No | Yes |
| Capital required | Very low | Moderate |
| Number of transactions | One | Two |
| Profit transparency | Buyer sees assignment fee | Profit hidden |
| Closing speed | Fast | Slower |
Pros and Cons of Assignment
Pros
- Very little capital required
- Fast transactions
- Lower risk
- Simple contract structure
Cons
- Assignment fee is visible
- Some sellers or buyers may question large fees
- Certain title companies restrict assignments
Pros and Cons of Double Closing
Pros
- Profit remains private
- Larger spreads possible
- Works when assignments are restricted
Cons
- Requires funding
- Two closings instead of one
- Higher transaction costs
How Wholesalers Choose Between Assignment and Double Closing
Most experienced wholesalers follow a simple guideline:
- Use assignment when profit is under $20,000
- Use double closing when profit is large or privacy is needed
Therefore, assignment remains the most common exit strategy for wholesale real estate deals.
Create Wholesale Contracts in Seconds
If you plan to assign contracts regularly, using a properly structured purchase agreement is essential.
You can create a wholesale purchase contract with assignment language in under 90 seconds.
Generate Your Wholesale Contract (Free Trial)
Frequently Asked Questions
Is assigning a real estate contract legal?
Yes. In most markets, assigning contracts is legal as long as the purchase agreement allows assignment and proper disclosures are made.
Do wholesalers need money for double closing?
Yes. Because the wholesaler actually buys the property first, funding or transactional financing is typically required.
How much is a typical assignment fee?
Most wholesale assignment fees range from $5,000 to $25,000, depending on the deal.
Can sellers refuse assignment?
Yes. Some sellers or contracts restrict assignments, which is why wholesalers sometimes use double closings.
Final Thoughts
When deciding between assignment vs double closing, most wholesalers choose assignment because it requires less capital and closes faster.
However, double closings can still be useful when spreads are large or privacy is necessary.
Understanding both strategies helps investors structure deals more effectively and maximize profits.