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scope of the “big box banks.” Nobody coaches them on making their credit fundable and attractive to lenders. Here’s the crazy thing: Most Ameri- cans, with a little help, could easily get their scores and profiles into the Tier 1 fundable range (740 or higher). They just don’t know how. (There are some well-intentioned nonprofits out there in this field, but many never get their clients to their goal.) The final result for many buyers is a sense of failure. HOPE changes this dynamic. HOPE works because it combines owner financing with the support that cred- it-challenged buyers need. With the help of CreditSense, The PIP Group brings to investors the buyers they want and need. For the buyers, The PIP Group provides the opportunity to own their part of the American Dream— and to do so without the risk of predato- ry terms and unrealistic expectations. There is an army of buyers out there who fail to qualify for traditional financing. As an investor, you are the solution to their problem. There are a multitude of ways HOPE can work, and we will explore a couple of those possibilities next. As with all of The PIP Group’s opportunities, as an in-
vestor, you should know that you remain entirely hands-off. This is an entirely passive investment opportunity for you. HOW HOPE WORKS Let’s walk through a typical HOPE deal. As an investor in The PIP Group’s Passive Profits Program, you enable us to invest into a fix-and-flip opportunity on your behalf. The property is repaired and listed for sale. A potential buyer expresses interest in your property. But that person states that he or she would likely not qualify for a traditional mortgage and would need a lease-option or owner financing. Through PIP, the buyer and seller will negotiate a price and other terms of sale, just as any other traditional pur- chase would be handled. Upon acceptance of sale terms, the buyer will engage PIP and CreditSense for a Credit Funding Analysis. This will look at the buyer’s income and credit and will determine ways to optimize a buyer’s fundability in three to five years. Once the fundability analysis is completed and approved by PIP and the investor, the buyer will pay a deposit of $3,000 to $5,000. (The exact amount depends on the analysis.) This deposit is
paid to the fundability optimizer, Cred- itSense. CreditSense then guarantees the fundability of a loan from a traditional lender in three to five years from the date of the execution of the agreements. The PIP Group facilitates and executes agreements between PIP, the investor, CreditSense and the buyer. The PIP Group also oversees the time- ly payments toward the option/finance. That includes, but is not limited to, pay- ment of taxes, insurance and HOA fees. The PIP Group also oversees the on- going optimization of the buyer’s credit and fundability. CreditSense will make regular reports on the buyer’s progress toward becoming fundable, and it will inform PIP when the buyer is ready. Upon fundability, PIP will facilitate contacts, contracts and negotiations with traditional lenders on behalf of the buyer. Plus, at this point, the buyer should have built up enough equity in the property, thanks to the ongoing pay- ments to the investor. That means there is no need for a deposit—just capital for closing costs. Best of all: All of the above is reported to PIP’s client-investors. They can check on the deal’s progress whenever they want through our online client portal. ANOTHER OPTION FOR INVESTMENT Maybe you’d rather not invest in a fix- and-flip up front. Maybe you’d rather lend money to the buyer to help them borrow a property someone else cur- rently owns. HOPE can help you, too. Through our networks of select real estate brokers and agents, we have buy- ers ready to borrow your money at rates of as much as 12 percent (depending on the state) for three to five years. Here’s how it would work: • An agent or broker has placed a home under contract on behalf of a buyer, but the client is unable to qualify, or even prequalify, for a mortgage. • The agent or broker introduces the client to PIP and HOPE. After PIP
FULFILLING THE DREAM HOPE Program Helps Make Home Ownership a Reality for Those Who May Have Thought it Impossible.
by Charles Sells
F or too many people, an essential part of the American dream is com- pletely out of reach: There’s no way they will ever own their own home. Maybe that’s because their credit has been wrecked. Or their minimum wage job doesn’t allow them to save up enough money for a down payment on a house. In many cases, they’re just reliable, hardworking people who have experienced a run of bad luck. But homeownership doesn’t have to be an impossible dream. My company, The PIP Group, has teamed up with the credit optimization experts at Credit- Sense to create a better path to buying a home—while also generating returns for investors like you.
We call it HOPE—the Home Owner- ship Preparation Experience. I’ll talk about HOPE’s process in depth later, but in a nutshell, it com- bines elements of owner financing with credit optimization. We help buyers “get their foot in the door” and start making payments on a home. Within three to five years, their credit is fundable and they have enough equity to qualify for a traditional mortgage. WHY THE OLD WAY OF OWNER FINANCING ISN’T WORKING Owner financing has gotten a bad rap in recent years. In some cases, that’s because investors aren’t interested in long-term deals, but the stigma is also
due to the many predatory “lenders” out there. Too many owner-financers com- bine simple early terms with unrealistic adjustments or balloon payments that were next-to-impossible to satisfy. Even in cases where owner-financers aren’t looking to gouge the buyers, there usually is some sort of requirement for the buyers to get their own financing or deal with a balloon payment. Otherwise, the monies paid just revert back to lease payments with no ownership interest. Throughout this process, the buy- ers—who might not have a ton of finan- cial expertise— are basically on their own. Nobody helps them qualify for a traditional mortgage. Nobody helps them connect with lenders outside the
8 | Platinum Investment Properties Group, LLC
www.PIPGroup.com | 9
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