FAQ
We've put together some frequently asked questions to provide you more information about Parcel Funders and the services we offer. If you need further help, please contact us.
General
We fund land deals nationwide (50 states and D.C.).
Depending on the property, price, and location, we'll consider land deals that do not fit this criteria.
We don't run credit or background checks on our investors as a prerequisite to offering transactional or joint venture funding.
We don't have a minimum funding amount and we have a maximum amount of $1,000,000.
We offer a free Proof of Funds letter to our investors on bank letterhead. Please contact us and we'll email you the letter in PDF format for your specific property.
Yes, we can fund multiple parcels at one time and we're okay with selling them separately.
Generally, we'll fund option payments, down payments, and earnest money, but each deal will be handled on a case-by-case basis.
While other funders may openly share information about the deals they have funded, we absolutely do not. Our funding agreement includes non-disclosure language that bars us from discussing your deal with anyone else.
No. We’ve fine-tuned our process so you can request funds through our online service. We make it fast and simple to use and all signatures can be completely through digital signature, fax or by printing, signing, and then scanning and emailing the forms back to us.
Yes, we require each deal to go through a title company or title attorney and that the same one be used on both the buy and sale side of the transaction.
Yes, we require that you have a signed purchase and sales agreement (PSA) prior to requesting funding for a land deal.
Yes, but it's on a case-by-case basis.
We don't have income requirements for our investors as we're an asset-based funder.
It's helpful if you under the basics of land investing, but we do fund new land investors without having done a deal.
No, we cover all closing costs so the investor doesn't have to come out of pocket for any fees related to the purchase and sale of the property.
No, an appraisal is not required. We will underwrite your deal in-house and get you a funding commitment within 48 hours.
Transactional Funding
Transactional funding is a method of supplying money for an investor’s purchase of a property which has already been resold to an end-buyer. The money is usually used for less than a complete day as the investor closes with the seller and later in the day his end-buyer closes.
A double closing is defined as the closing of the purchase and sale of a property twice in the same day. The end-buyer can close first or second, but the original seller must close the same day to be able to use transactional funding. If the A – B “leg” closes on one day and the B – C leg closes another day, “extended” transactional funding is required. This extended use of the money will often be a hard money loan and will usually need a mortgage and note to secure the lender’s money.
We charge 3% of the acquisition price of the property ($3,000 minimum fee), and there are no upfront or additional fees if the transaction does not close charged by us. In addition, we require you to pay for Lender's Title Insurance and a Lender's Closure Protection Letter. These are standard lender fees.
We require the following documents from all principals of the borrower: the A to B Contract, the B to C Contract, government ID, closing firm details (contact name, phone, and email) and if applicable, corporate documents (operating agreement, articles of organization, and EIN letter). In addition, if the C Buyer (end buyer) is getting a loan to purchase the property, please send all lender information (contact name, phone, email, pre-approval letter, term sheet, short sale approval letter, HUD/REO acceptance letter, etc.). If you're buying in a trust, we'll need the the Agreement and Declaration of the trust, the Appointment of Trustee, Assignment of Beneficial Interest, the Affidavit of Trust, and the Deed to Trustee. We are the last money in and the first money out. Therefore, we fund once we have confirmed both sides have signed and the end buyer's funds have been placed with the title attorney or company.
We require both the A-B and the B-C transactions occur at the same title attorney or title company. Some exceptions are possible, so please discuss your specific situation with us if you'd like the transactions to close at different offices.
Joint Venture Funding
The property has to be worth at least $10,000 for us to consider funding the land deal.
We require a minimum net profit of $7,500 for us to consider funding the land deal.
You will have 12 months to sell the property. In the event that you are unable to market and obtain a buyer for the property during this time, then we shall have the right to either sell the property or sell through any third party without paying you any portion of the net profit from the deal.
Yes, we're willing to sell the property on terms, but 100% of the money paid by the buyer for the property must be paid to Parcel Funders until the cost of acquiring the property is satisfied. This includes the original purchase price, property owner’s association dues, property taxes, property liens, closing costs, and any other costs related to purchasing the property. Parcel Funders will be recapitalized within six months or less of the acquisition settlement date. Then, we and the investor will divide the net proceeds of sale according to our agreed upon profit split percentage.
Depending on the length and success rate of our funding relationship, we provide funding for marketing to off market sellers to acquire their land.
