Assignment vs. Double Close: How to Choose the Right Structure for Your Massachusetts Real Estate Deal

If you are buying a property and immediately reselling it to an end buyer, you have two basic ways to structure the transaction: assignment of contract, or a double close. These are not interchangeable. The right choice depends on who is paying what, lender rules, title considerations, timing, and how much risk you are willing to carry.

Getting this decision wrong can cost you the deal, the deposit, or your relationship with the end buyer. Getting it right — with the right paperwork — is often what separates experienced investors from beginners.

What Is an Assignment of Contract?

You sign a Purchase and Sale Agreement (P&S) with the seller. Instead of buying the property yourself, you assign your rights under that P&S to your end buyer for an assignment fee. The end buyer closes directly with the seller, and you collect your fee at closing.

In an assignment, you are selling a contract position — not real estate itself. This is the simpler, lower-cost structure when it is allowed.

Choose assignment when:

• The contract clearly permits assignment
• The end buyer is cash or has a lender-friendly structure
• You want minimal closing costs and no need to fund a purchase
• The deal does not require you to first resolve title, occupancy, or financing issues

Common deal-killers for assignments:

• The P&S prohibits assignment or requires seller consent — and seller says no
• The end buyer’s lender won’t allow or recognize the assignment structure
• The seller or listing agent refuses to deal with wholesaling arrangements

What Is a Double Close?

A double close means you actually purchase the property from the seller (the A-to-B transaction), and then immediately sell it to the end buyer (the B-to-C transaction). These two closings can happen the same day or on different days, and the first purchase is funded by your own cash, hard money, private money, or transactional funding.

In a double close, you are buying and reselling real estate — not assigning a contract. This gives you more control but comes with more cost and more risk.

Choose a double close when:

• The end buyer’s lender requires you to be the owner of record
• The seller will not allow assignment
• You need tighter control over the transaction
• You want to avoid broadcasting your spread as an assignment fee
• You are working with a retail listing where assignment is a non-starter

The Key Differences That Actually Matter

Funding and Risk

Assignment requires minimal funding — perhaps only earnest money and transactional costs. A double close requires you to fund the first closing, carry real owner risk (title, liability, insurance, transfer tax) for at least a moment, and bear the risk that if the second closing fails, you own the property.

Closing Costs and Massachusetts Transfer Taxes

Assignment involves one closing and a lower overall cost footprint. A double close involves two closings and two rounds of transfer taxes. Massachusetts charges state transfer taxes of $4.56 per $1,000 of sale price (0.456%). On a $400,000 property, that is approximately $1,824 on the first closing — and again on the second. Some municipalities add local transfer taxes on top. Your numbers need to be tight, not just favorable on paper.

Lender and Underwriting Friction

Many end-buyer lenders do not like assignments, or they want them handled very specifically. If the end buyer is using a conventional mortgage, assignments can become a headache quickly. Double closes are often cleaner for lender optics because the end buyer purchases from the current owner of record. However, same-day resales can still trigger lender questions about seasoning and anti-flip policies.

Disclosure and Spread Visibility

Some investors prefer double closes because they do not want the seller or end buyer focused on the spread. This is not inherently illegal. But it becomes a serious problem if anyone plays games with disclosures, side agreements, or misrepresentations to a lender. If a lender is involved, there is no room for creative accounting.

Massachusetts-Specific Issues to Watch

• Standard Massachusetts forms and broker addenda often prohibit assignment or require written seller consent — if the paper says no, it means no unless the seller agrees in writing
• Repeatedly marketing properties you do not own for compensation can drift into unlicensed brokerage activity — structure and advertising both matter
• TRID disclosures and lender requirements must be respected at every step when consumer financing is involved
• Not all creative transaction structures are insurable — the closing attorney and title underwriter will scrutinize identity of parties, source of funds, payoff statements, and recording order

Frequently Asked Questions

Q: Can I hide my assignment fee from the seller or end buyer?

No. If a lender is involved, full disclosure is required under federal lending laws. Concealing fees through fake invoices, side agreements, or misrepresentations constitutes fraud. A double close provides more privacy, but not permission to deceive.

Q: Will a conventional lender allow an assignment?

Most conventional lenders are skeptical of assignments and may prohibit them outright. FHA has strict anti-flipping rules that make assignments difficult. If your end buyer needs conventional financing, a double close is usually the cleaner path.

Q: What assignment language should be in my Purchase and Sale Agreement?

Your P&S should state clearly that the contract is assignable. Common language includes: ‘Buyer reserves the right to assign this agreement to a third party’ or ‘Buyer may assign their interest without seller consent.’ Adding ‘and/or assigns’ after the buyer name also helps. Have a real estate attorney review the specific language.

Conclusion

Assignment is cheaper, faster, and lower-risk when it is permitted and the end buyer can actually close. A double close is more expensive and requires funding, but it solves seller and lender resistance and gives you more control. The correct structure is the one that is allowed by the contract, acceptable to the lender, insurable by title, and profitable after real closing costs and taxes.

LEGAL DISCLAIMER: This blog is provided for general informational purposes only and does not constitute legal advice. Every real estate transaction is unique. For advice specific to your situation, contact a licensed Massachusetts real estate attorney.