The "Bank Concept"™

Summary

The "bank concept" is a group of "grassroots" thinking individuals who together with like-minded folks, organized in a lenders' club, seek a better, safer, shorter return on their money by providing private funds to a developer-builder for the sole purpose of acquiring and developing niche market real estate opportunities, ie, "collateralized" income-producing properties, or land for development.

Once the individual's capitol, plus interest, is returned, usually in 366 days, he/she retains the right of first refusal to reinvest (roll) the capitol on a no-obligation, first-come-first-served basis into another project.

eagle Investor ROI

Transactions yield a fixed return of 12% for one year (366 days); or, 8.3% per year for up to 3 years (24.99%)

Investor Security

Deed of Trust on property (a lien on the property); and, Mortgage Note (Promissory Note) ... in favor of the Lender (Club)

Additional Protection

In some larger projects the "bank" will further protect the Investor's capital (Corpus)

Structure

Limited Liability Company

Approach

Loaned funds are escrowed in a Title Company Trust account, with receipt provided (checks made out directly to Title company)

Use of Funds

Short term financing of third party (Borrower) acquisition of real estate Borrower uses funds to acquire, rehab, and carry (if needed)

Capitol Goals

First project: $612,500 for land; $600,000 for product development; then, various projects: 1st year $5M, 2nd year- $20M, 3rd year- $50M

Investor Exit

On or before Borrower's loan anniversary, the improved property is refinanced, thus insuring the Lender's return of principal, plus interest to the "bank's" escrow account. At this point the individual Lender may take the money, or reinvest.

Project Types

Single family (custom or tract) homes, multi-family projects, professional office buildings, or flex space, which are primarily in need of upgrade, or simply represent an under market buying opportunity. Once completed, the property value will be sufficient to refinance at an amount that pays back the Lenders with interest.

Market Locations

eagle

Initially Colorado, several niche markets; then, selected markets in other high niche market states.

Market Demographics

Neo-Yuppie; high-end executive estates, associated professional use buildings, and flex space.

Background

Borrowers have extensive experience in the residential tract, semi- and custom-built homes, and the rehab, renovation and restoration market.

Term

One year (12 months, or, 366 days) for most transactions; pre-determined extension fees will apply if borrower asks for, and is granted, a short extension. The "Term" of the loan is project specific, and, more complex projects are up to 3 years.