Almost Every Type of Real Estate Investor Deal in Texas — And What You Need to Close Each One
Real estate investing in Texas isn't one-size-fits-all. Depending on your strategy, your exit, your financing, and your relationship with the seller, the right deal structure can vary dramatically from one transaction to the next.
One of the things that separates experienced investors from beginners is knowing which tool to reach for in a given situation — and knowing what each deal type requires when it comes time to close. That's where we come in.
Here's a plain-English breakdown of the most common investor deal types in Texas, what they are, when to use them, and what the title company needs to know about each one.
- Wholesale Assignment
What it is
You get a property under contract and then assign your contractual rights to an end buyer for an assignment fee. The end buyer steps into your shoes and closes directly with the seller. You never actually own the property — you're selling your contract, not the house.
When to use it
When you want the simplest, lowest-cost exit. No need to fund the purchase, no double closing costs, and the process is straightforward. Best when your end buyer is comfortable with — or indifferent to — seeing your assignment fee on the closing disclosure.
What the title company needs
Your original purchase contract, your signed assignment agreement, and confirmation that the original contract doesn't prohibit assignment. The title company will close between the seller and your end buyer and pay out your assignment fee at closing.
Assignment fees in Texas have no legal cap. Whatever you and your end buyer agree to is what gets paid.
- Double Close (Simultaneous Close)
What it is
You buy the property from the seller (A-to-B) and sell it to your end buyer (B-to-C) on the same day. Two separate transactions, two separate deeds recorded. Your end buyer doesn't see your purchase price, so your profit margin stays private.
When to use it
When your spread is large and you'd rather keep your numbers private. Also useful when your end buyer or their lender has issues with assignment deals.
What the title company needs
Two complete purchase contracts, clear funding for the A-to-B leg (your own capital or transactional funding), and a title company comfortable coordinating both closings. Not all title companies handle double closes — make sure yours does before you're under contract. At Cedar Springs Title, we take the additional steps to maintain privacy between the frontside and backside contract stakeholders. Pass through funding may be available on a situational basis, ask for more details.
- Novation Agreement
What it is
A novation replaces one party in a contract with another, with the consent of all parties. In real estate investing, a novation agreement is sometimes used as an alternative to a standard assignment — you're substituting your end buyer into the original contract, effectively replacing yourself as the buyer.
We also see novations used when the seller does not want to take on the burden of selling, and trust the investor to market the home on their behalf, knowing that they will receive a fixed proceeds while the investor holding the novation gets the additional proceeds based on their end buyer negotiations.
When to use it
Novations are useful when the original purchase contract has language that restricts traditional assignment, or when a seller is more comfortable with a novation structure. Some investors also use novations in creative financing scenarios where the original agreement needs to be restructured with a new buyer.
What the title company needs
A properly drafted novation agreement signed by all three parties — the seller, you (the original buyer being released), and the new buyer stepping in. The title company will review the novation to confirm it clearly transfers all rights and obligations and that the seller has affirmatively consented to the substitution.
Novations are less common than assignments but are a useful tool when a standard assignment isn't an option. If you're using one, make sure your paperwork is airtight before you open title.
- Subject-To (Sub2)
What it is
In a subject-to deal, you purchase the property and take title while the seller's existing mortgage stays in place. You're buying the property "subject to" the existing financing. The seller's name remains on the loan; you make the payments.
When to use it
Sub2 is a powerful strategy when a seller has equity but can't or won't go through a traditional sale — often in pre-foreclosure situations. It lets you acquire properties with little to no money down by taking over existing financing rather than getting a new loan.
What the title company needs
A purchase contract that clearly outlines the subject-to structure, the existing loan details (lender, balance, payment terms), and a deed transferring title to you. The title company will also want to confirm there are no due-on-sale clause complications that could immediately trigger the loan payoff.
A note on due-on-sale clauses: most conventional mortgages have them, which technically allows the lender to call the loan due when title transfers. In practice, lenders rarely enforce these on performing loans, but it's a risk investors should understand and discuss with their attorney before proceeding.
At Cedar Springs Title Company we can help draft the Sub2 paperwork in addition to a promissory note or a traditional DOT (deed of trust).
- Seller Financing (Owner Financing)
What it is
The seller acts as the lender. You make payments directly to the seller over time instead of going through a bank. Title typically transfers to you at closing, and the seller holds a lien (deed of trust) against the property until the note is paid off.
When to use it
When conventional financing isn't available or practical — distressed properties that won't qualify for a traditional loan, sellers who want income stream rather than a lump sum, or investors who want to preserve capital.
Sometimes seller financing can include " A Wrap" otherwise known as a lien in first position. The seller may hold a note on the property in addition to the original note they have with their mortgagor.
What the title company needs
A promissory note outlining the loan terms (amount, interest rate, payment schedule, balloon payment if any), a deed of trust to be recorded against the property, and a standard purchase contract with a seller financing addendum. The title company handles recording both the deed to you and the deed of trust in favor of the seller.
- Land Contract (Contract for Deed)
What it is
The seller retains legal title until you complete all payments. You have equitable interest in the property and possession, but the deed doesn't transfer until the contract is fulfilled. Common in seller-financed transactions where the seller wants an extra layer of security.
When to use it
Less common in investor-to-investor transactions, but still used in seller financing scenarios — particularly in rural markets or with sellers who are cautious about transferring title before they're paid in full.
What the title company needs
Texas has specific statutory requirements for contracts for deed (Texas Property Code Chapter 5). The title company will want to review the contract carefully to ensure it meets state requirements, including required disclosures and the seller's obligations regarding property taxes and insurance.
Texas law has strengthened protections for buyers in land contract situations over the years. If you're using this structure, make sure your contract complies with current Texas Property Code requirements.
- Fix and Flip
What it is
You buy a distressed property, renovate it, and sell it for a profit. Straightforward in concept — the execution is where the work lives.
When to use it
When you have the capital, the contractor relationships, and the project management bandwidth to execute a renovation and resell within your target timeline. Often times lenders will give a construction loan with a balloon payment - it's a risk but if your build out stays on track investors can perform the flip with little out of pocket expenses.
What the title company needs
Standard purchase contract on the acquisition side. On the resale side, you'll want the title company to run a full title search again before you list — mechanic's liens from your renovation contractors can attach to the property if they go unpaid. Make sure all contractor relationships are documented and paid before closing your resale.
- Buy and Hold / Rental
What it is
You acquire a property with the intent to hold it long-term as a rental, building equity and cash flow over time.
When to use it
When your market has strong rental demand and you want passive income rather than a quick flip. North Texas — particularly emerging markets like Cooke County and Kaufman County — offers strong cash-on-cash returns for investors getting in ahead of the curve.
What the title company needs
Standard purchase contract. Many buy-and-hold investors close in an LLC or other entity for asset protection — let your title company know upfront so they can prepare the correct vesting. If you're using a lender, they'll require a lender's title insurance policy.
Investors that buy to hold often use hard money lenders on the acquisition, then refinance with better terms once the tenant is under contract. In these scenarios, CST offers a refi discount to keep closing costs low.
- 1031 Exchange
What it is
A 1031 exchange (named after Section 1031 of the IRS tax code) lets you defer capital gains taxes when you sell an investment property, as long as you reinvest the proceeds into a "like-kind" replacement property within specific time windows. It's one of the most powerful tax deferral tools available to real estate investors.
When to use it
When you're selling an appreciated investment property and want to roll your equity into a new property without taking a significant tax hit. Done correctly over many years, 1031 exchanges can allow investors to keep building a portfolio while deferring capital gains indefinitely.
Key rules to know
- You have 45 days from the sale of your relinquished property to identify potential replacement properties.
- You have 180 days total to close on the replacement property.
- The replacement property must be of equal or greater value than the property sold.
- You must use a Qualified Intermediary (QI) to hold the proceeds between the sale and the purchase — you cannot touch the funds yourself.
What the title company needs
The title company works closely with your Qualified Intermediary to make sure the exchange is properly structured at closing. Notify your title company that you're doing a 1031 exchange before closing begins — this affects the closing documents, the disbursement of funds, and the required language in the deed. Don't spring this on the title company at the last minute.
1031 exchanges have strict timelines. Missing your 45-day identification window or 180-day closing deadline disqualifies the exchange entirely. Work with a QI and a title company that understands the process from day one.
- BRRRR (Buy, Rehab, Rent, Refinance, Repeat)
What it is
A strategy where you buy a distressed property, rehab it, rent it out, then refinance based on the new after-repair value (ARV) to pull your capital back out — and repeat the process. Done well, it lets you build a rental portfolio with limited ongoing capital.
When to use it
When you have the renovation skills and the patience for the refinance timeline. It's a slower-moving strategy than flipping but can be extremely capital-efficient if executed correctly.
What the title company needs
The title company is involved twice in a BRRRR — at acquisition and at the refinance. At acquisition, standard purchase closing. At refinance, the lender will order a new title search and require a lender's title policy. Make sure your property is free of mechanic's liens before the refinance appraisal.
- Short Sale
What it is
The lender agrees to accept less than the full mortgage balance to release the lien and allow the property to sell. Typically happens when the seller owes more than the property is worth and is facing financial hardship.
When to use it
Short sales can produce below-market acquisitions, but they require patience — lender approval adds weeks or months to the timeline.
What the title company needs
The lender's written short sale approval letter before closing can proceed. The approval letter will specify the exact payoff amount, the closing deadline, and any conditions. The title company works to the lender's timeline and conditions — these are non-negotiable.
- Probate and Estate Sales
What it is
Purchasing a property from an estate — either through the probate process or directly from heirs who've inherited the property. Often times a Will or Trust may even force a liquidation.
When to use it
Estate properties are often motivated sales — heirs want to liquidate, not manage property. They can be excellent acquisition opportunities, especially in markets like North Texas where estate sales are common in older neighborhoods.
What the title company needs
This is where title gets more complex. The title company needs to verify the chain of title, confirm that the estate has been properly probated (or that all heirs are accounted for and willing to sign), and review any letters testamentary or letters of administration granting authority to sell. Missing or incomplete probate is one of the most common title issues in estate deals.
To date - our record is clearing 26 heirs to get a property ready to sell. Most title companies will direct investors or sellers to a real estate attorney to manage the heirship documents, costing thousands in curative fees. At Cedar Springs Title - we just want to help you get your deals closed and aren't afraid of a little leg work.
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One Title Company for Every Deal Type
Here's the thing — a lot of title companies are comfortable with maybe two or three of these deal types. The rest make them nervous, slow them down, or cause them to ask a lot of questions that eat into your closing timeline.
At Cedar Springs Title, we work with investors across North Texas on all of these deal structures. We've seen double closes, sub2 deals, 1031 exchanges, novations, probate sales, and everything in between. We're not going to make you feel like your deal is unusual — because to us, it isn't.
If you've got a deal and you're not sure how to structure it at closing, call us. We're happy to talk through it with you before you're at the table.
How can Cedar Springs Title Company help you close your next real estate investor deal in North Texas?
Cedar Springs Title Company works with real estate investors across North Texas — cash deals, double closes, wholesale assignments, sub2, novations, 1031 exchanges, and everything in between. If you're ready to close, we're ready to help.
