Transactional Funding

Transactional funding is a form of short-term financing used primarily in real estate wholesaling and investment transactions to facilitate back-to-back closings. It provides the investor with temporary capital to purchase a property, often for a very brief period ranging from a few hours to a few days, until a subsequent sale to an end buyer is completed. The funding is typically repaid immediately upon the resale of the property, and lenders offering transactional funding focus primarily on the strength of the end buyer and the overall deal rather than the creditworthiness of the initial purchaser.
This type of financing is most commonly used in “double closing” transactions, where the investor first acquires title to the property and then resells it at a higher price to a third party. Transactional funding allows the investor to complete the initial purchase without using their own capital, while maintaining control of the transaction and potentially increasing profit margins. Because of its short duration and specialized use, transactional funding often carries higher fees and strict timing requirements, and it may not be available in all jurisdictions or for all types of transactions.