Status: Repaid

Annual Return Term Remaining
9.25% -
Loan to ARV
65.1%
Investment Offering
$2,800,000
Min. Investment
$5,000
Term
12 mo.
Underlying Asset
Single Family
Guarantee
Personal Guarantee
Underlying Security
1st Position

Updates


Fund That Flip is pleased to inform you that the loan has been paid off. The payoff date is 02/25/2020.

You will receive the following payments related to this payoff: December 2019 Normal Interest, January 2020 Normal Interest, February 2020 Partial Normal Interest, 2 Late Fees, 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.

The monthly interest payment for January has not yet been received.

A late fee has been assessed and will be distributed according to investor’s pro rata share of the investment, upon payoff.

Fund That Flip will continue to monitor this situation closely and investors will be notified as further developments occur.

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

The developer has sent over commitment letters from the new lender for the refinance.

They are planning to close by the third week in February.

Investors will continue to be updated as further developments occur.

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

The developer has represented that the refinance closing date has been pushed to the middle of next month.

Investors will continue to be updated as further developments occur.

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

The developer has represented that he will be closing on a refinance to pay off this loan within the next few weeks.

The developer has requested to wrap December's interest payment into the payoff of the loan and has agreed to pay the associated late fee.

Investors will continue to be updated as further developments occur.

The monthly interest payment for December has not yet been received.

A late fee has been assessed and will be distributed according to investor's pro rata share of the investment, upon payoff.

Fund That Flip will continue to monitor this situation closely and investors will be notified as further developments occur.

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

The developer has taken the house off of the MLS in an effort to secure a refinance. Fund That Flip has since requested verification.

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

Investors will continue to be updated as further developments occur.

The updated maturity date for this loan is 4/27/2020.

The developer has requested a loan extension to finalize a sale of the project.

Fund That Flip has verified that the borrower has completed the rehab on this project.

The property is currently for sale.

After communication with the developer about the revised timeline for the sale, Fund That Flip has approved the customer's request.

The maturity date will be extended an additional six months.

Investors will receive their share of collected extension fees in the next 3-5 business days.

Fund That Flip has ordered an inspection of this property to monitor the progress.

The project is 100% complete.

Fund That Flip has processed the final construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 90% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 78% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 67% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 61% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 53% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 32% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

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

The developer has requested to execute their first six-month extension to finalize the completion of the rehab on the project.

After communication with the developer about the revised timeline for the project, Fund That Flip has approved the customer's request.

The maturity date will be extended an additional six months with an updated maturity of 10/27/2019.

The developer will also have an option to extend for an additional six months and if elected, Fund That Flip will collect a fee for disbursement to investors at payoff.

Investors will receive their share of any collected extension fees at time of payoff.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 21% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has ordered an inspection of this property to monitor the progress.

Based on the Inspection Report this project is at 9% completion.

Fund That Flip has processed a construction draw to reimburse developer expenses.

Investors will be notified as further developments occur.

Fund That Flip has been in communication with the developer for this project. They represented that the foundation has been approved on inspection and is completed.

Framing work will begin shortly and the project has been pre-listed for sale online. The developer is planning a spring marketing event and represented an intention to have framing and roof completed by that time. Their goal is for those with perspective interest to be able to view the progress and have a sense for the layout of the home.

Fund That Flip is planning an inspection of the property to document progress to date and will post further updates as they come available.

Investment Summary


Type New Construction
Underlying Asset Single Family
Underlying Security 1st Position
Guarantee Personal Guarantee

Fund That Flip closed the loan on this property on April 27, 2018. Your investment will begin accruing interest on the day it clears escrow.

Fund That Flip has provided a first distribution of $629,578 to the developer at closing for a loan to purchase of 53.6%. Fund That Flip is holding back $157,422 for 6 months of pre-paid interest.

The construction budget is $1,820,644. Fund That Flip will finance $1,941,000 of the total construction budget, which includes a small contingency amount above the estimated rehab budget. Should the cost of the project exceed the expected rehab budget, Fund That Flip will open investment for the allotted contingency. Fund That Flip disburses constructions 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 5 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 $654,488 in equity, including an estimated $545,422 at the time of closing. The total loan-to-ARV is 65.1%. There is a 3-month pre-payment penalty, meaning investors will earn interest through July 27, 2018, even if paid back earlier. The term of the underlying loan is 12 months with an option to extend for two periods of an additional 6 months each. Should Fund That Flip choose to grant the second 6-month extension, investors will earn an additional one-time 0.5% fee on their pro rata investment.

Use of Proceeds


  Cost Use of Proceeds % of Loan
Purchase Price $1,175,000 $629,578 22.5%
Expected Rehab Budget $1,812,800 $1,941,000 69.3%
Prepaid Interest Amount $157,422 $157,422 5.6%
Closing Fees $72,000 $72,000 2.6%
Total $3,217,222 $2,800,000 100.0%

Loan to Cost


  Cost Amount Disbursed Borrower Contribution Loan to Cost
Purchase Price $1,175,000 $629,578 $545,422 53.6%
Expected Rehab Budget $1,812,800 $1,941,000 $128,200 107.1%
Prepaid Interest Amount $157,422 $0 $157,422 0.0%
Closing Fees $72,000 $72,000 $72,000 100.0%
Total $3,217,222 $2,642,578 $646,644 82.1%

Valuation


Valuation Method Estimated Value Amount Distributed LTV
Purchase Price $1,175,000 $629,578 53.6%
Appraised ARV: $4,000,000 $2,800,000 70.0%
FTF Valuation: $4,300,000 $2,800,000 65.1%

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 4.98 miles of the subject, have a similar number of bedrooms, bathrooms, and square footage, and are of similar home style.

The internal valuation of $4,300,000 on the property is supported by the following data points:
• 4 comparable properties have recently sold between $3,500,000 and $5,350,000.
• Price per square foot of these comparable properties ranges from $675 to $1,725.
• Our internal valuation yielded a price per square foot of $835.

Fund That Flip supplemented our internal valuation with an appraisal. The appraisal indicated an ARV of $4,000,000 for the property. We believe a more accurate portrayal of the subject property to be our internal analysis and valuation.

In review of the appraisal, Fund That Flip noted the following items:
• After reviewing the borrower’s previous completed projects, we concluded the comps used in our internal valuation will be a more representative portrayal of the subject property's final As Repaired Condition.

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

About the Property


Details

Bedrooms 5
Full Bathrooms 6
Year Built 2018
Square Footage 5149 SF
Garage Spaces 2
Purchase Price $1,175,000
Estimated Rehab Budget $1,812,800
ARV $4,300,000
Developer Equity $646,644 plus closing & holding costs

Market Overview


• Sag Harbor is an incorporated village in Suffolk County, New York. Most of the defining landmarks of the village — including its Main Street, the Whalers Church, Jermain Library, Whaling Museum, the Old Burying Ground, Oakland Cemetery, Mashashimuet Park, and Otter Pond are in Southampton. However, almost all the Bay Street marina complex, including Sag Harbor Yacht Club and Breakwater Yacht Club, at the foot of Main Street, is in East Hampton, as is the village's high school, the Sag Harbor State Golf Course, and the freed slave community of Eastville.

The Village of North Haven community features private tennis courts, docking rights, and private security. This property borders a 40-acre nature preserve with inlet water views.

The subject property is located:
    • 3.2 miles from the Sag Harbor Yacht Club, approx. an 8-minute drive
    • 5.1 miles to Sag Harbor Golf Course, approx. a 13-minute drive

• Retail Sales Sold: 82%
• Short Sales Sold: 4%
• REO Sold: 14%
• 131 Average Retail DOM in the past 3 months

  • data acquired from internal sources.

Project Strategy


The developer previously purchased the land and refinanced with financing from Fund That Flip on April 27, 2018. Your investment will begin accruing interest the day it clears escrow.

Construction will begin shortly after loan closing and includes the following:
• Plans, Permits, & Survey
• Water/Sewer Prep
• Landscaping and Irrigation
• Foundation
• Framing
• Decking
• Windows
• Plumbing
• Electrical
• Interior & Exterior Paint

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 65.1%.
• 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.