Status: Repaid

Annual Return Term Remaining
8.75% -
Loan to ARV
57.5%
Investment Offering
$230,000
Min. Investment
$5,000
Term
12 mo.
Underlying Asset
Two Family
Guarantee
Personal Guarantee x2
Underlying Security
1st Position

This deal does not have an active offering

Updates

  • 09/21/20

    Fund That Flip is pleased to inform you that the loan has been paid off. The payoff date is 09/18/2020.

    You will receive the following payments related to this payoff: September 2020 Partial Normal Interest and Principal.

    You can expect to see these funds deposited in your bank account within 5-8 business days. In addition, these payments will be view-able from your investor dashboard.

  • 08/20/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that they plan on paying this loan off by maturity. They are looking at multiple exit strategies, including both refinance and liquidating assets to pay the loan off in cash.

    Timely interest payments continue to be made on a monthly basis.

    Investors will continue to be updated as further developments occur.

  • 06/25/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that framing is complete and they will begin working on rough-in mechanicals in the coming weeks.

    Timely interest payments continue to be made on a monthly basis.

    Investors will continue to be updated as further developments occur.

  • 05/05/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The architectural plans have been approved by the city.

    All construction work has been halted due to local ordinance in response to the health crisis. The developer has confirmed adherence to government mandate and remains committed to the safety of their team. They are targeting to resume work in the coming weeks.

    Timely interest payments continue to be made on a monthly basis.

    Investors will continue to be updated as further developments occur.

  • 03/19/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that they have experienced delays due to the city not issuing approvals which has pushed back the timeline of completion.

    Timely interest payments continue to be made on a monthly basis.

    Investors will continue to be updated as further developments occur.

  • 01/13/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that they are performing a larger rehab and have secured a line of credit to help with the financing.

    The timeline for completion of the rehab is still set for February.

    Investors will continue to be updated as further developments occur.

  • 11/27/19

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that the project is moving along quickly and they expect to be complete with the rehab by mid-February.

    Timely interest payments continue to be made on a monthly basis.

    Investors will continue to be updated as further developments occur.

Investment Summary


Type Rehab
Underlying Asset Two Family
Underlying Security 1st Position
Guarantee Personal Guarantee x2

Fund That Flip closed the loan on this property on September 19, 2019. Your investment will begin accruing interest on the day it clears escrow.

Fund That Flip has provided a first distribution of $189,633 to the developer at closing for a loan to purchase of 59.4%. Fund That Flip is holding back $6,517 for 3 months of pre-paid interest.

The construction budget is $29,800. Fund That Flip will finance $28,250 of the total construction budget. Fund That Flip disburses construction funds based on verification of work performed, as determined by an independent 3rd party inspection firm. Fund That Flip reviews each inspection report and releases funds based on the percentage of completion of the project. Fund That Flip expects to make 3 construction draws, but may schedule additional inspections as needed. The final draw will be released after all work is verified to be complete.

Over the course of the project, the developer will contribute an estimated $143,033 in equity, including an estimated $129,367 at the time of closing. The total loan-to-ARV is 47.4%. There is a 3 month pre-payment penalty, meaning investors will earn interest through December 19, 2019, even if paid back earlier. The term of the underlying loan is 12 months with an option to extend. Should Fund That Flip choose to grant the extension(s), half of the extension fee(s) collected will be distributed to investors upon receipt.

True purchase price is $280,000 -- there is a wholesale fee of $25,000 and $4,000 in penalties making the borrower's total acquisition cost $319,000.

Use of Proceeds


  Cost Use of Proceeds % of Loan
At close $319,000 $189,633 82.4%
Purch. $319,000 $189,633 82.4%
Construction Draw at Close $0 $0 0.0%
Remaining Construction/Rehab $29,800 $28,250 12.3%
Prepaid Int $6,517 $6,517 2.8%
Closing $5,600 $5,600 2.4%
Total $360,917 $230,000 100.0%

Loan to Cost


  Cost Amount Disbursed Borrower Contribution Loan to Cost
At close $319,000 $189,633 $129,367 59.4%
Purch. $319,000 $189,633 $129,367 59.4%
Construction Draw at Close $0 $0 $0
Remaining Construction/Rehab $29,800 $28,250 $1,550 94.8%
Prepaid Int $6,517 $0 $6,517 0.0%
Closing $5,600 $5,600 $5,600 100.0%
Total $360,917 $223,483 $143,033 61.9%

Valuation


Valuation Method Estimated Value Amount Distributed LTV
Purchase Price $319,000 $189,633 59.4%
FTF Valuation: $400,000 $230,000 57.5%

Fund That Flip's Internal Underwriters use industry standard valuation software, independent real estate data, and internal proprietary modeling to estimate the expected After Repair Value of the property.

Fund That Flip develops an internal valuation on all projects using an automated valuation model (AVM), which estimates real estate property valuations using mathematical modeling, combined with a database of real estate information for comparable properties. The comparable properties in the analysis are within 1.0 mile of the subject, have a similar number of bedrooms, bathrooms, and square footage, and are of similar home style.

The internal valuation of $400,000 on the property is supported by the following data points:
• 4 comparable properties have recently sold between $325,000 and $407,000.
• Price per square foot of these comparable properties ranges from $176 to $223.
• Our internal valuation yielded a price per square foot of $205.

Fund That Flip used the FTF internal valuation when making the final decision to fund this project.

About the Property


Details

Bedrooms 3
Full Bathrooms 2
Year Built 1925
Square Footage 1840 SF
Purchase Price $319,000
Estimated Rehab Budget $29,800
ARV $400,000
Developer Equity $143,033 plus closing & holding costs

Market Overview


• Philadelphia is a city in Philadelphia County, PA

    • 2.0 miles to Temple University
    • 2.8 miles to St. Christopher's Hospital for Children
    • 4.2 miles to Philadpelphia Museum of Art

• Retail Sales Sold: 96%
• Short Sales Sold: 0%
• REO Sold: 4%

  • data acquired from internal sources.

Project Strategy


The developer bought this property with financing from Fund That Flip on September 19, 2019. Your investment will begin accruing interest the day it clears escrow.

Construction will begin shortly after loan closing and includes the following:
• Demolition
• Interior Paint
• Roof Repairs
• Plumbing
• HVAC Servicing
• Bathroom Tile
• Laminate Flooring
• Electrical
• Kitchen Countertops
• Kitchen Cabinets

The full statement of work is available below.

Risk


Having a thorough understanding of the risks of each investment in your portfolio is important prior to making an investment. Fund That Flip encourages you to do full due diligence on each deal and consult your investment, tax and legal advisors prior to investing.

Risk:
The market value of the property drops significantly removing opportunity for the developer to make a profit.

Mitigating Factor:
The property is located in a stable market and was purchased at a discount providing downside protection in a falling-price environment.

Risk:
The developer chooses not to complete the project.

Mitigating Factors:
• The developer has considerable equity in the project and the LTV on an ARV basis is 57.5%.
• Fund That Flip holds a first position lien on the property and the partner has personally guaranteed the loan.

Risk:
The developer is unable to complete the project in the allotted 12 month period.

Mitigating Factor:
Fund That Flip has built in a 3 month optional extension, approved only if project is advancing at a satisfactory pace. Extension corresponds with an additional fee to be shared on a pro-rata basis with investors.

A more complete list of risks for this investment is provided in the Investor Offering Materials and should be read and reviewed with your investment, tax and legal advisors.