The appraisal fee is contingent on the willingness of the seller to carry this expense. If
payable it is paid directly to the appraiser. The sourced investor may or may not accept
dated appraisal. Properties zoned commercial typically require an MAI appraisal. In
any case, it is the sourced investor that has the final word on appraisal issues.
**The cash consideration represents the amount of money that the applicant must
provide to complete the transaction. (Proof of Funds may be used to for required cash consideration) These funds must be in the form of cash. Equity in any property may NOT substitute for cash consideration. Lastly, funds located in title escrow must first be released in order to be applied as cash consideration.
The net investor fee is what the investor charges to perform on a non-qualifying
transaction. It is a small price to pay for an enormous individual commitment on the
part of the sourced investor. The exact amount of the investor fee is determined by the
transaction size and the amount the investor is agreeable to. It is NOT possible to
determine in advance of submitting an application where the investor fee will precisely
come in. Therefore, applicants should base their decision to apply on the maximum
investor fee of 15%. The investor fee is not paid out-of-pocket. It is rolled into the
transaction similar to rolling it into a loan which is simply added to the top of any actual
loan amount. (Further explanation below)
Closing costs incurred by the sourced investor in connection with purchasing the
property is passed on to the applicant. It is not possible to itemize the exact costs in
advance, though they will be detailed prior to completion of the transaction.
Applicants that need this information prior to applying should not apply. Closing costs
are typically in the 3% to 5% range of the sale price. Closing costs can’t be rolled in.
Sellers can contribute the closing cost.
Applicants should apply for program approval only if they are agreeable to the
potential fees involved, only some of which are known prior to the submission of an
application.
Approval Requirements
It is sometimes difficult to adjust to the idea that an applicant will be approved
regardless of credit score or income and job status verification. This however, is
definitely the case, as our programs are not loans and money is not being borrowed.
We do not evaluate the applicant beyond personal character references. Instead, the
property and appraisal value are the central focus. As long as minimal requirements are
met, the application will, usually be approved by an investor: Get your application in TODAY! Click here to submit (See requirements below)
Required cash consideration available
Normal property structure not remotely located
3 character references
Stated Income indicating the the applicant can afford reasonable monthly trust payments
Correct analysis fee submitted with application
For each application resulting in approval, an approval letter will be provided. Approvals expire one (1) year from the date they are issued. If a property on a pending application is withdrawn for any reason, a new property may be substituted as a replacement during the approval period of one year. In this case a new analysis fee is not required.
Investment properties are compatible with this program.
Application Processing
The following steps (in order below) take place in connection with the processing of a transaction:
Applicant name, phone number, property description, and cash consideration validation in form of a copy of a bank statement will be submit to my office. Once this information is received, an Application will be sent to applicant for completion and the steps listed below begin. Click here to submit the information!
1. Application and analysis fee is sent
2. Applicant references are verified
3. Investor is sourced
4. Formal approval is issued
5. Approval letter is provided
6. Cash consideration is submitted to program facilitator
7. File is submitted to investor for funding
8. The investor completes pre-funding due diligence – at expense of investor
9. The investor executes the property purchase agreement immediately prior to scheduling a closing date
10. First closing is schedule and property is purchased
11. Second closing follows 24-48 hours later between the investor and the applicant.
While the sourced investor in fact purchases the property and the property is titled to the investor, the actual property is placed in the trust with the applicant receiving the first option
Required cash consideration must be available! (POF may be used for required cash consideration) Ask about Proof Of Funds and maintain your cash flow. POF can be used as an alternative to paying the full cash consideration. Details will be provided upon request
Consideration Requirements
The property cash consideration requirement is not treated like a fee. The amount is generally set at 15% for owner occupied residential and 20% for commercial property and residential non-owner occupied and is calculated on the purchase price plus the investor fee. It is credited to the transaction in a similar way that a down payment is credited on a real estate purchase.
Important: To determine the actual cash consideration amount add the maximum investor fee of 15% of the sale price to the actual purchase price. Then multiply that result by the appropriate cash consideration requirement. Example: Purchase price $1,000,000 plus the 15% investor fee = $1,150,000.
If it’s a residential owner occupied transaction the cash consideration would be 15% of the $1,150,000 or $172,500.
If it’s a commercial property or a non-owner occupied residential transaction the cash consideration would be 20% of the $1,150,000 or $230,000.
To confirm the actual cash consideration required for your specific transaction, contact your Consultant, Charles Gardner.
The final exact amount of cash consideration required is determined by the investor who approves the transaction.
The property cash consideration is submitted to the program facilitator after an approval is issued.
The total out-of-pocket expense is limited to the application/analysis fee, cash consideration and closing costs.
Properties needing advanced funds for construction require double the cash consideration. This means that in the event that the sourced investor would normally require 15% consideration the revised requirement would be boosted to 30%.
Cash consideration has only one of two possible final destinations. In the event of a successful closing the funds are released to the sourced investor. If a closing does not take place on account of the investor or due to a cancellation on the applicant side, the funds are returned to the original submitter.
Analysis Fee Refund Policy
In the event that an applicant is not approved, the associated analysis fee is refundable, providing the aplicant signs a general cancellation form release. Equally, if the sourced investor is unwilling or unable to complete the transaction, the analysis is also refundable.
The analysis fee is non-refundable in the event that the applicant is approved and the sourced investor is willing to complete the transaction.
This refund policy may not be superseded by a third party or verbal representation of any kind by any party. In the event that a discretionary exception to this refund policy is granted, a 25% cancellation charge may apply.
Summary
The processing of an application is far less complex due to the significantly reduced red tape than financing via a mortgage loan. Closing time frame is very similar to any FHA loan generally in the 45 to 60 day range.
Terms, conditions and program availability are subject to change without notice. The program is designed for those that cannot qualify for any other type of financing. It is not a product meant to compete with banks or traditional mortgage companies.
Here’s to YOUR Success. See you on the other side!! Happy Investing’!
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