I . Overview
A . WDCFCT fundings are not loans . Instead , they are Joint Venture Partnerships ( JVPs ) — a form of equity — between CTF and the REW Pro ; this is achieved via 50 / 50 split of the resulting net profit : The wholesaler brings the deal , CTF puts up the purchase money for the first close + any costs to remove CTIs .
B . Obviously , all the paperwork involved ( for both closes ) has to be carefully crafted to offer maximum protection to all parties , with appropriate security and collateral issues spoken to successfully , which is why we require that doc prep , title and escrow functions all be assigned to service vendors chosen by CTF .
Problem : The property was burdened with several Clouded Title Issues . Unless and until those CT problems could be solved , the seller was stuck due to a lack of money to pay them off , plus he had pretty bad credit . To make matters worse , if he did not sell the house very soon , he could lose it in a matter of weeks to creditors and receive no money at the end .
C . When CTIs are involved , very close attention to detail takes on added importance . It is often the case that it can take many days , in some cases , to achieve 100 % clear title — especially when there are multiple liens or other loans on the property that each need to be dealt with successfully .
Solution : A commercial loan broker reached out to my firm for help . Once all the needed paperwork was set up properly , we agreed to fund the property purchase for the wholesaler . The amount we funded included enough money to pay off each of the CT debts that plagued the property . It took a few days to get clear title ; however , in the end , it was a winwind for all parties .
Wholesalers Double Close Financing : Clouded Title
Following is information about the Wholesalers Double Close Financing ( WDCFCT ) program from our firm , Creative Transaction Funding ( CTF ). The WDCFCT program is available to experienced Real Estate Wholesaler Professionals ( REW Pros ):
A . Who need money to fund double close deals , i . e . those that include two separate escrows .
B . There are Clouded Title Issues ( CTIs ) that may block the acquisition of the property unless and until the CTIs are fully resolved .
C . CTIs ( as CTF defines them ) may include ( but are not limited to ) the following types of problems : property tax lien , preforeclosure , mechanics lien , HOA lien , lawsuit , lis pendens , divorce , probate dispute , IRS lien , state income tax lien .
II . Features , Benefits , Costs
A . How it works : We form a Joint Venture Agreement ( JVA ) with the REW Pro .
B . CTF ’ s profit comes from a 50 %/ 50 % profit split with the REW Pro .
C . We do not require any upfront , outofpocket fees from the REW Pro . There ARE of course “ overhead costs ” involved with every deal to cover : backoffice expenses , administrative costs , underwriting expenses , document preparation fees , closing costs , referral fees , etc . Those overhead costs are fixed at 15 % of the funded amount for all deals . The 15 % overhead amount is deducted from the gross profit at closing . The remaining net profit is split 50 %/ 50 % between CTF and the REW Pro .
D . We provide WDCFCT funding nationwide .
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