Which Site is Right for You?
7 Questions You Need to Ask
There are hundreds of crowdfunding sites these days. So how to choose the right one for your next real estate project? Some are direct lenders, some are brokers, and some are simply “match makers” between private investors and borrowers. Here are 7 questions to ask to find the best fit:
What’s Their Focus?
Many crowdfunding sites are primarily focused on investors. You can tell quickly by a glance at their site who they care most about. Few show a balance between borrowers and investors. Have a look around. Is it easy to find out how to apply for funding? Do they offer tips and resources for borrowers? If it’s not immediately clear, they’re probably not the site for you.
Do They Service Your Area?
Some crowdfunding sites are national. Some are even international. And some are regional specializing in areas where they have considerable expertise. One of the first questions to answer is which sites service the neighborhood where you operate.
Do They Fund Your Type of Project?
Do they do primarily commercial? Do they fund residential projects? What about construction? Do they offer refinancing or gap funding? Make sure the site services match your project needs.
Do They Pre-fund?
This is an important consideration. Sites that pre-fund their deals mean that you get funded as soon as you qualify. Qualification in this scenario likely means the site does thorough due diligence and underwriting. It also means there is no managing or waiting on the private investors before you see your funds. You can get started on your project right away!
Are They Fast?
The speed of closing is often the difference between making your deal or losing it. What kind of timeframes do they offer from application to full funding? What’s the process for making draws for renovations? Is it quick and painless?
How Much of the Project Will They Fund?
Does your site offer funding based on the Current Market Value or After Repair Value? Can it fund up to 100% of your costs?
What’s the Bottom Line?
Be clear about your costs. What fees are involved? Are there loyalty programs that provide better terms for repeat business? Do they have any pre-payment penalties? You’ll find most sites collect their origination fees up front. But you can find a site that offers to collect them on the back end. That means less cash is needed to close. It also means they don’t get paid until you successfully complete your project and submit your final payoff.
There is no doubt that crowdfunding is revolutionizing the funding of Real Estate Projects. If you’re a professional who does multiple projects a year, crowdfunding is a more reliable source because these sites to tap into a large number of private investors. Finding the right site for you can be like finding the well that never goes dry.
Zeus CrowdFunding guarantees fast, affordable funding for all qualifying projects including: residential, commercial, and construction. Full service funding opportunities also include refinancing, gap financing, and temporary to permanent financing. The Fast Track option gets you funded in as few as 4 days. The LoyaltZ program offers improved terms for repeat business. No origination fees are collected up front…ever!