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Don’t miss out on another real estate investment opportunity.

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Real estate developers know how important it is to secure capital quickly, to avoid losing out on a great investment opportunity. What you want to do with your rehab property is up to you. No matter what your ambition is, one thing that’s certain is renovation costs are going to require a large sum of money a lot sooner rather than later. We understand that having access to a fast and reliable source of funding becomes paramount for community rebuilders.
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What is the problem with platforms that don’t prefund?

Waiting for the crowd could mean watching opportunity pass you by.

Most real estate crowdfunding platforms will host a project and wait for it to become fully funded before moving forward with the developer’s rehab work. However, there are some disadvantages associated with using this process.

For starters, if the property takes a long time for the crowd to fund, it might end up being sold to another developer in the interim. In addition, real estate investors who have contributed funds to these potential projects are left waiting while their money is sitting dormant in a non-performing investment. And even if the project does get fully funded, the end result is still a lot of time lost that rebuilders could have spent rehabbing the property.

These disadvantages are exactly why Patch of Land was the first to come up with the concept of prefunding real estate investments through its crowdfunding portal.

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What is the solution?

Don’t wait. Let us prefund your loan BEFORE the crowd.

Patch of Land is proud to have been the first crowdfunding platform to offer prefunded real estate loans. By offering a prefunding solution, our Borrowers can rely on us to ensure quick, on-time closings in as little as 7-10 days.*  At the same time, Investors using our crowdfunding platform have developed a greater sense of confidence in our products, knowing that their money will begin earning interest in a timely manner instead of sitting in an escrow account waiting for a deal that may never close.

Our Borrowers can rely on us to ensure quick, on-time closings in as little as 7-10 days.*

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What are the benefits of prefunding?

Patch of Land's prefunding strategy helps real estate developers secure good investment opportunities and begin their projects much sooner than later.

After proper due diligence, we commit to prefund loans with our internal credit line, enabling closings in as little as 7 days. Unfortunately, many traditional crowdfunding platforms may take upwards of 60 days to raise funds for a project, if they're able to at all. Real estate developers know how important speed to close is when it comes to acquiring a property before it's sold to another party, that's why they appreciate Patch of Land's methods of prefunding their loans in order to secure their investment and allow them to waste little to no time before they can begin construction.

Accredited investors also realize a huge benefit when participating in Patch of Land’s prefunded real estate investments. In fact, once we place a prefunded investment opportunity on our crowdfunding platform, an Investor who participates in that peer to peer loan will begin to accrue interest on their contributions quickly -- 3 business days after an investment order is placed, and as soon as accreditation is verified. Once you are an active investor with funds on the platform, it begins to accrue immediately.  This is opposed to traditional real estate crowdfunding portals which will hold your money in a dormant state until the loan is fully funded by the crowd. This alone is a big reason why Patch of Land's prefunding methods have become so popular and important for investors looking to diversify their portfolio today.

Patch of Land began offering prefunded real estate investment opportunities from day one because of the clear and apparent benefits it has for both borrowers and investors using its crowdfunding platform.  Our successful prefunding strategy has already begun to set the standard by which other real estate debt crowdfunding platforms operate. In the end, we are proud to be trendsetters in the real estate crowdfunding industry and look forward to continuing to innovate and develop new ways of offering the best products and services to our customers.

Underwriting is one of our highest priorities.

Quality projects and quality operators are paramount to our continued success. We currently operate through rigorous traditional underwriting, including arms-length third party appraisals, commissioned by Patch of Land for a full walk-through and value analysis, with an ever increasing emphasis on selectively choosing the most relevant data and metrics to support that underwriting.

We carefully evaluate the local market, the performance of that particular asset class in that market, and the risk profile of the borrower. We generally work with professional, experienced developers with strong track records in the real estate industry and fund up to a certain percentage of the ARV (after repair or rehab value) of the property. That way, in a worse case scenario, we can liquidate the property and have a reasonable expectation of being able to return most or all of our investors’ funds.

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How do we do it?

The reason Patch of Land is able to prefund our peer-to-peer rehab loans is because of the confidence we have in our tech-enhanced due diligence process.

This system combines a highly sophisticated computerized scoring engine with a hands on 'Makes Sense' underwriting approach to provide speed, reliability, and care to our closing procedures.

While the computer generates scores based on more than 4,000 data points, Patch of Land's 'Makes Sense' underwriting helps take into account humanistic factors that computerized intelligence cannot quantify.

As a result, Patch of Land is able to accurately assess risk and calculate the profitability of every short-term investment opportunity with complete transparency and extreme confidence.

Patch of Land's due diligence and underwriting process is efficient.

Patch of Land implements traditional and non-traditional elements to our underwriting procedures. Some of the traditional methods include arms-length third party appraisals, commissioned by Patch of Land for a full walk-through and value analysis, pulling comparable data and metrics to evaluate the local market, the performance of that particular asset class in that market, and the risk profile of the borrower.

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Want to learn more? Read these related articles.

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Patch of Land's Due Diligence & Underwriting Process

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Real Estate Crowdfunding Underwriting Process

Growing with PoL Part 2: The Underwriting Process

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