Transactional Funding and How it Works
Business → Marketing & Advertising
- Author Dave Lindahl
- Published October 17, 2010
- Word count 505
If you are entering into property investment, chances are you have heard of quick flips in the past and simultaneous closings. These are virtually things of the past,(in the way they were at one time financed), and really not something that you want to expend your energy in researching as these sort of practices have become quite scrutinized by the government. There is however a new concept of quick flips in respect to the financing aspect of it.
What you should be looking at however, is transactional funding which will basically give you the same benefits of the quick flips or dry closings as they are also known as, at a much safer and acceptable level.
When you become involved in transactional funding you are actually doing bridge financing, or obtaining a bridge loan this can be utilized for your simultaneous closing. This is going to give you all of the advantages of the quick flip without having to utilize your own money. There are companies in place that specialize in transactional funding where you are able to obtain these funds. To make things even simpler you may be able to utilize the funding in that company's name or in your own company ventures depending on the type of transaction that you are entering into.
Naturally there are going to be fees for these types of services and for the bridge financing, but it still is putting you into a very lucrative position for making substantial money when you didn't have to put out any of your own financing. It has to be remembered though that this is not a long drawn out transaction. The bridge loan is usually a one day loan, where the transaction takes place right at closing.
Obtaining this kind of transactional funding is really not very difficult, and often there are no credit checks or appraisals that are required. It can usually be done and put in place within 48 hours, so that the one day financing is in place for the day of the property flip.
If you are looking at fast paced action in your property investment, then transactional funding is certainly going to give you what your looking for. The prerequisite however is that you must have the property and buyer in place, so that the moment you purchase your property you are going to in the same day sell it to another buyer. By doing this with transactional funding you have done a quick flip, made a substantial amount of money with very little cost. As long as you can produce the creditability and the end buyer has been approved, you will certainly have no difficulties finding multiple sources for transactional funding.
Timing is everything when it comes to the transactional funding. It is because of the simultaneous transaction that makes it feasible for no actual financing costs will be incurred. Again yes, there are other costs involved but the investor still comes out ahead more so then he would likely do in a conventional transaction.
David Lindahl, also known as the "Apartment King" has been successfully investing in single family homes and apartments for the last 14 years and currently owns over 7,000 units around the US. David regularly shares his secrets and experience on the same stage as Tony Robbins, Robert Kiyosaki, and Donald Trump!
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