I’m started making about 100 offers a month on properties. I’m going to expand to luxory homes that are short sales. The issue I’m finding with banks is that they want the proof of funds to have my company’s name listed since my company is on the contract. If I’m going to use private money of a silent partner that’s not in my account, how do I accomplish this?
thanks in advance!
What are you doing with these properties? Are you buying Luxury Homes so you have upscale lawns to mow each week? lol
If your wholesaling and never owning the property for more than 24 hours, why do you have a partner? If your buying to rehab / remodel obviously a partner comes in handy!
You could ask this silent partner to speak with his bank about issueing a bank letter of credit backed and supported by the money partners bank accounts, but vested in your companies name!
Maybe even simpler than that is getting a mortgage broker on your team who will issue a mortgage pre-approval letter to your company. I have a team member who issues me a brand new mortgage pre-approval every xx number of days depending on state so I always have a pre-approved mortgage 365 days a year.
I substitute financing in escrow depending on the transaction!
The exit strategy varies. Some of these properties will be purchased with partners money and then sold with seller financing and then selling the note later. For these types of deals same day dough isn’t an option. I have preapprovals, but when you mention that your buying for cash, the banks want to see the funds in your account with your name (been through that numerous times).
I’m sure I could setup a joint venture and create an llc and put the funds in that business account however, I was looking for an easier solution especially for new partners.
There is no reason you could not structure your contract to use your pre-approvals and then substitute method of financing (All Cash) before closing of escrow (Timing obviously varies).
That should work in some cases, however, when you specify “cash” transaction, the banks want to see that money in the account under the companies name.
Do a search for transactional funding. There’s a company out there that provides a similar product (at a cost). If I find an old POF letter, Ill get back to you.