No Doc – No Credit – Commercial Financing Program

No Doc Commercial Real Estate Financing

Do you want financing solely based on the income and appreciation of property you are purchasing? Trust Purchase Program offers that opportunity. This may be one of the best programs available for commercial real estate investors who has 20% for down payment. This is a trust program where the property buyer is not qualified for financing based on their personal credit or income qualifications. The qualifications are solely based on the strength of the property. Does the property have value that is stable and appreciating? Does the property generate income that will cover the mortgage plus give the owner substantial return on their investment? If these answers are yes your project will be funded.

No Doc Trust Purchase Program

You may ask how does this program work. How can a lender not verify income or assets a make a loan with competitive interest rates? Well first the Trust Purchase Program is not technically a loan. A private investor purchases the property for the buyer and places the property in trust. Once the property is placed in trust the investor receives a cash consideration to give a beneficial interest in the trust and a right of first refusal so the trust can not sell the property from under the buyer. During the term of the agreement to purchase the property the buyer pays a fully amortized interest rate that compensates the private investor who purchased the property and provides “defacto” financing for the buyer. Finally, with the right of first refusal the buyer has the ability to refinance, sell or other wise transfer their interest in the property the same way they would in a traditional purchase.

Advantages of the Trust Purchase Program

This is a no documentation, stated income, stated asset program that is based on the strength of the collateral. This program is not based on the credit history of the buyer but totally on the value of the commercial real estate. A major ingredient for determining the value of the commercial real estate is the income the property generates. Therefore a real estate investor who has down payment can purchase income producing property regardless of their past credit history.

Disadvantages of the Trust Purchase Program

Ultimately, because of the costs if a buyer could qualify for a traditional commercial mortgage they should choose that option. As the interest rates of this no documentation product is only slightly higher, the fees and due diligence costs are much higher. One other major consideration when weighing the advantages of on financing program over another, the trust program does not have to foreclose as a traditional mortgage. If an investor does not have reserves for emergency they should not employ this program or they should refinance out of the trust as soon as possible if they choose to keep the income producing real estate for the long term.

For the trust purchase program and financing for other income producing real estate contact FBC Funding at financingbroker@gmail.com

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