Transactional Funding Loans Details
Transactional funding loans, also known as same-day funding or flash funding, are short-term financing options specifically designed for real estate investors, particularly wholesalers. These loans facilitate back-to-back property transactions, enabling investors to purchase a property from a seller and sell it to an end-buyer simultaneously without using their own funds.
Loan Fees
Property Criteria
Loan Terms
Appraisals / Insurance
Borrower Criteria
Loan Overview
| Loan Programs Type | Commercial Loans | Residential Loans | Land / Lots Loans | Fix / Flip Loans |
|---|---|---|---|---|
| Do We Offer Them? | Yes | Yes | Yes | Yes |
| LTV | 70-80% | 70-80% | 0-50% | 70-80% |
| Minimum Loan Amount | $75,000 | $75,000 | $75,000 | $75,000 |
| Maximum Loan Amount | $5,000,000 | $5,000,000 | $5,000,000 | $5,000,000 |
| Loan Term Offered | 6 or 12 months | 6 or 12 months | 6 or 12 months | 6 or 12 months |
| Interest Rate Offered | 12.99% | 12.99% | 12.99% | 12.99% |
| Points Charged | 2 or 3 based on term | 2 or 3 based on term | 2 or 3 based on term | 2 or 3 based on term |
| Pre-payment Penalty | No | No | No | No |
| Insurance Requirements | Property, Windstorm | Property, Windstorm | N/A | Property, Windstorm |
| Flood Insurance Requirements | For Floodzone Properties | For Floodzone Properties | N/A | For Floodzone Properties |
| Lending Area | Texas Only | Texas Only | Texas Only | Texas Only |
| Special Requirements | Phase 1 - Loans > $1 million | N/A | Possible Survey | N/A |
What Is Transactional Funding?
Transactional funding, also known as same-day funding or flash funding, is a unique financial strategy primarily used in the real estate sector. It involves investors taking out very short-term loans to facilitate real estate transactions, often within the same day. This type of funding is especially beneficial for real estate wholesalers who aim to earn a significant profit on a same-day, simultaneous “double close” without requiring any money out of their own pocket. In essence, short-term capital investors borrow to complete real estate deals. It’s a creative financing strategy that involves a short-term loan borrowed and paid back usually within a day.
What Properties Qualify for Transactional Funding?
Both residential and commercial properties can qualify. This type of funding works well for short sales, wholesale deals, and property flipping. The most critical aspect is that the property is part of a back-to-back or simultaneous closing. This means that the wholesaler purchases the property from a seller and assigns the contract to an end buyer within the same day. The property itself should have a clear title and a ready-end buyer.
Who Should Consider Applying for Transactional Funding?
Ideal for real estate wholesalers, flippers, and investors who engage in simultaneous closings. It’s also suitable for those who wish to leverage their cash flow and minimize personal financial risk. If you’re involved in short sales, REOs, foreclosures, or auctions, you might find transactional funding beneficial. It’s a way to finance short-term needs, such as working capital or inventory, making it a viable option for startups as well.
What Sorts of Projects Are Transactional Funding Good for?
Perfect for projects that require quick, hassle-free, and affordable 100% financing. These include short sales, foreclosures, wholesale deals, property flipping, and other types of real estate transactions that can be closed within a day. This funding is also good for transactions involving distressed properties or properties sold at auctions.
Why Choose Larry the Lender for Transactional Funding?
Larry the Lender offers reliable hard money solutions across various sectors. With our quick, easy, and smart transaction funding, wholesalers can earn significant profits without ever using their own money. We understand the importance of speed in these transactions, and we strive to provide fast, hassle-free funding. Our team of experienced professionals is dedicated to helping you succeed.
Benefits of Transactional Funding
It provides 100% financing, allowing you to keep your cash flow intact. It minimizes personal financial risk as you don’t need to use your own money. It’s quick and hassle-free, perfect for deals that need to close within a day. Moreover, it gives you the ability to take advantage of profitable real estate deals without worrying about funding.
Transactional Funding Loan Application
Applying for a loan with Larry the Lender is simple and straightforward. You need to provide details about the property and the deal, including the purchase and selling price and information about the end buyer. We’ll assess your hard money loan application quickly and let you know the decision so you can move forward with your real estate transaction.
Transactional Funding FAQ
What is transactional funding?
Also known as flash funding, is a short-term financing solution designed specifically for real estate investors engaged in simultaneous buy-sell transactions — often referred to as “double closings”. The lender provides the funds needed to complete the initial purchase, with the understanding that the loan will be swiftly repaid after the property is resold.
How does transactional funding work?
Where can you get transactional funding?
What are the benefits of using transactional funding?
Are there alternative options to transactional funding?
Yes, there are several alternatives including traditional bank financing, private money loans, and hard money loans. However, these options may not offer the same speed and flexibility. For instance, bank loans often involve lengthy approval processes and stringent qualification criteria. Private and hard money loans can provide quicker access to funds, but they typically come with higher interest rates and fees.
