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Frequently Asked Questions

Easy Transactional Funding

Easy Transactional Funding

Copyright @ Strategic Resource Management, Inc. All rights reserved.

1.  What is transactional funding and how does it work?

Transactional funding is where a buyer of a real estate property utilizes funds for a short period of time, usually 24 hours, to facilitate a transaction. The fee is less than it would be using a hard money lender, there is no risk to the buyer's credit, and there is not a lot of red tape because the buyer isn't qualifying for a loan. For full details, please see Transactional Funding: What It Is and How It Works​.


2.  What are your transactional funding rates?
We offer specific flat fees for amounts up to $100,000. A 2% fee from $100,100 to $500,000 and 1.75% for repeat clients. Fees for loans above $500,000 are determined on a case-by-case basis. Please refer to our Fee Schedule  for complete details.

3.  Will you also fund my closing costs?
Yes. We can fund 100% of the AB transaction (the first transaction) so that there is ZERO out-of-pocket costs for you. The loan amount, plus our transactional funding fee, comes out of the proceeds of your BC sale.

4.  Do you charge a processing fee?
Most transactional funding companies charge a processing fee of between $400-500. We DO NOT charge a processing fee. We want to make your transaction simple, fast and easy. When we say, “No out-of-pocket costs for you regarding your AB transaction.”… we mean it.

5.  Are there any other expenses or hidden costs?
No. You are not required to produce ANY cash or pay any additional expenses regarding the AB transaction since we will fund 100% of it, including closing costs. (Note: There is one possibility of an out-of-pocket expense for you if your Seller requires a Verification of Deposit, or VOD, in addition to our Proof of Funds Letter. The cost for this would be between $250-500. An advance payment to SRM, via PayPal, would be required before the VOD could be created and submitted to your Seller.)

6.  Do you fund commercial properties?
Yes. As long as it is a back-to-back transaction and both transactions close on the same day.

7.  Do you provide funding for bundled purchases (multiple properties) as one transaction?
Yes. As long as it is treated like ONE transaction: all funds go into one escrow account, and they are reimbursed within the same day. If each property has to be processed separately, then it isn’t a bundle.

8.  Do you have minimum and maximum funding amounts?
Our minimum is $50,000. There is no maximum. We can fund deals of $1,000,000 and above. We will consider any back-to-back deal that has an end buyer in place.

9.  What is the rate for transactional funds greater than $1M?
The rate would depend on factors such as the transaction itself, timing of the closing, volume of deals that you bring to us, etc. Deals of 1M or above are dealt with on a case-by-case basis. The way to obtain a definite answer on the rate is to fill out and submit a Request for Transactional Funding  form on the website, so that we can evaluate the deal. We will usually get back to you with a rate quote within one business day.

10. How much funding can I request, and how often can I request it?
We can fund most any amount.  And, there are no limitations to the number of deals that you can do through us.  If your flips (back-to-back closings) meet our general requirements, we will fund them for you. Transactions over 1M are given special consideration and are handled on a case-by-case basis.

11. When I have a flip deal ready to go, how do I request transactional funding?
To ensure that your request is processed rapidly, and that your transactions are smooth and successful, it is important that you read our Guidelines & Recommendations  BEFORE requesting funding so that you understand our funding process in full, as well as what will be required of you.  Once you understand the process, just click on the Request Funding  tab,  fill out the form, upload the required documents, and click on the submit button.

12. This is so accommodative and easy... Why does it seem too good to be true?
We are giving you access to the funds that you need for one day, so that you can complete your purchase transaction. This type of funding does not require strict lending requirements, complicated underwriting or mountains of paperwork---as applications for long-term collateralized loans do. If you set up your AB and BC closings properly, it is a simple loan transaction to execute. We receive a reasonable compensation fee for delivering this service to you. This is an easy and cost-effective way for you to fund ALL of your back-to-back closings so that you can have a profitable and growing business. Our service helps borrowers to overcome capital restraints that would prevent them from taking advantage of a profitable flip deal.

13. Do you provide funds for option, down payment, or earnest money?
No. You would need to obtain funding for expenses such as these from another source.

14. Will you fund the BC closing?
No. We only fund you, the B investor, for the AB closing. Your end buyer for the BC closing must have pre-approval for financing from a certified lender, or provide proof of funds if he/she is a cash buyer.

15. Do you also offer rehab financing?
No. We only fund back-to-back (consecutive), same—day closings.

16. What states do you fund in?
We fund nationwide.

17. What criteria do I need to meet in order to qualify for transactional funding?
All that is required is that you have all your documents in order, and the Seller (A), you (B) and a qualified End Buyer (C) in place. And, if your end buyer is using financing, once you get the Letter of Commitment  from the End Buyer’s mortgage company, you can then fill out a Transactional Funding Request Form  and submit it and the required documentation to us.

18. What information and documents do you need in order to evaluate my deal?
The best way for us to evaluate the deal is for you to complete ourTransactional Funding Request Form  and submit the documents that are requested on the form. This would specify the A, B and C parties and any other relevant circumstances——which would then give us a good understanding of the transaction. Subsequently, we would either commit to the transaction or contact you for any necessary clarifications or questions.

19. What type of credit checks are required?
None.

20. Are there any type of credit, income, asset or employment requirements?
No. We do not have any type of credit or income requirements associated with our transactional funding service. We do not base our fee or approval on your background, credit history or current financial profile. Our funding is based upon your deal.


21. Will my privacy and personal information be secure and protected on your website?

Most definitely.  Our company's Privacy Policy  protects you and your information. And, our website is secure.

22. Is there anything that would make me ineligible for transactional funding?
Yes. Not borrowing and transacting business through a legitimate business entity; having seasoning or resale requirements from your seller or end buyer; requesting transactional funding for consumer or personal reasons, as opposed to a "business-purposed loan"; current involvement in an undischarged personal or business bankruptcy; or having personal or business federal or state tax liens. Please refer to our Guidelines & Recommendations  for additional information regarding this question.

23. Will I need an appraisal for the AB or BC transaction?
An appaisal is not required for your AB transaction unless you want one. Your end buyer might or might not require one for the BC transaction. If your end buyer is using financing, his or her lender might require one. (Important Note: It is vital that you know the true market value of the subject property BEFORE you purchase it. Not knowing this could result in a major financial loss for you and your business.)

24. How much advance notice do you need to fund a back-to-back set of transactions?
To avoid any delays, it would be best to give us as much advance notice of your deal as possible. This will allow us the time to prepare for and process your funding request in order to commit to it as quickly as possible. We prefer to have 2-3 days or longer. Keep in mind that it will usually take the closing agent approximately two weeks to organize, manage and close both transactions. Once you have your end buyer fully in place; AB and BC transaction files opened with our closing agent; all required documents in place and signed; full purchase funds deposited for the BC transaction; etc., the closing agent will let us know, and we will then fund your deal that day or within 24 hours. If you have a RUSH/URGENT deal, contact us immediately and we will do everything in our power to help you to make it happen.

25. Can I get transactional funding on the same day of my request without having to give you advance notice?
We may be able to in some circumstances, if ALL aspects of the deal are in place and you are using one of our approved closing agents.

26. If the BC closing is unsuccessful for some reason, and the deal falls through on closing day, will I still have to pay your fee or any other costs?
No. We only charge a fee for deals that are fully completed. Generally speaking, if the BC closing does not occur due to your end buyer not going to closing for example, the AB closing would not occur since you planned to sell the property to the end buyer and had made it known to all parties. Our transactional funds would be returned to us at no cost to you and there would be absolutely no charge to you. You would not be held liable for any fees. We understand that sometimes deals are delayed or just don’t work out. We are interested in developing long term relationships with our clients so that we can continuously support and service their business needs. As a result, we hope that you will always turn to us for your transactional funding needs.

27. Can I have the AB closing and BC closing on separate days?
Yes. As long as the end buyer's funds are in escrow BEFORE the AB transaction closes. Yet, please note that there could be a higher transactional funding fee for back-to-back closings that don’t occur on the same day.

28. What if my end buyer in the BC transaction intends to finance the purchase with conventional financing?
There is no problem with your end buyer getting financing through the FHA or any conventional or institutional lender. As long as the full funds for the BC transaction have been deposited with the closing agent———and all the required documents have been ratified (agreed to and signed) for the BC sale———we will be able to fund your AB transaction.

29. What other types of back-to-back real estate transactions do you fund?
We can provide funds for residential and commercial REOs, FSBOs, probates, and MLS listed properties as long as these transactions are back-to-back, conducted on the same day, do not have “seasoning” requirements, and use the same title company, attorney or closing agent designated by us.

30. Can you recommend any specific title companies, escrow companies or attorneys in my area to act as the closing agent?
Yes. We will designate an accessible closing agent to administer your back-to-back closings.

31. Can I use my own closing agent?
Unfortunately not. Both transactions have to occur with one closing agent. More specifically, the disbursing agent for the funds has to be the same for both transactions. The closing agent must be experienced with back-to-back transactions, and familiar with and able to execute all the steps on our Lender Closing Instructions. Our policy requires that we designate the closing agent for the transactions. We do not use a Borrower’s closing agent.

32. Can I use two different title companies for each side of the transaction?
Unfortunately not. Both closings must take place at the designated closing agent’s office.

33. What about lender seasoning requirements?
If your end buyer is purchasing with financing, you must ensure beforehand that your end buyer’s lender will not enforce any seasoning or resale restrictions regarding the BC transaction. Otherwise, we won’t be able to fund your AB transaction. Both the seller and the end buyer’s lender should be informed from the beginning that you intend to purchase and then resell the property for a profit. (Please note that the FHA has rescinded their 90 day seasoning requirement.)

34. Do you provide POFs (Proof of Funds Letters)?
Yes. We provide property-specific POF Letters, as long as you use our funds. See ourRequest for Proof of Funds Letter  form.

35. Do you provide a bank statement to substantiate the POF Letter?
Yes. We can provide copies of a bank statement(s) if the A Seller requires it. If this is not sufficient for the A Seller, we can provide a Verification of Deposit (VOD). Yet, this would be done at a cost to you of between $250 to 500.

36. What do I have to do to qualify for a POF Letter?
Nothing. You can receive a property-specific POF Letter from us as long as you use our funds for closing on your same day, back-to-back transaction. See our Request for Proof of Funds Letter  form.

37. What information do I need to provide for a POF Letter?
Just the basic relevant information. Please see theRequest for Proof of Funds Letter  form on the website to learn the exact information that is required.

38. How do I obtain a POF Letter?
Just click on  Request for Proof of Funds Letter   on the menu bar, or any page on our site, fill out and submit the form, and you should receive your Proof of Funds Letter  via email within 24 hours.

39. How long will it take for me to obtain a POF Letter?
You will receive your property specific POF Letter on the day you make your request, or within 24 hours.

40. Can I use your POF Letter again for other deals?
Unfortunately not. We issue a POF Letter for specific properties only. We do not offer “blanket” POF Letters. Please fill out and submit a Request for Proof of Funds Letter  form for each separate property that you intend to make an offer on.

41. Do you fund individuals?
We only fund business entities such as corporations, LLCs and trusts as opposed to funding individuals (i.e., John Smith). Transactional funding is a "business-purposed loan" as opposed to a consumer loan.

42. Can I use my personal name for the deal?
Unfortunately not. We only fund business entities. (Please see the answer to Question #41 above.)

43. Can I use an LLC to purchase the property?
You can use any legal entity that is properly registered and in good standing (corporation, LLC or trust).

44. How long must my company be established before I can do business with you?
The company must be established before signing the closing documents. However, please consider that your company name must be cited on the respective AB and BC contracts. Thus, you should establish an entity before you start creating or signing any contracts.

45. Can my AB purchase be a property from an REO sale, a short sale, a probate sale or any type of wholesale or deep discount purchase?
Yes. The source of the property that you purchase, or the type of property that you purchase should not usually present any problems. As long as your transactions are back-to-back, conducted on the same day, do not have “seasoning” requirements from the seller, and use the same closing agent, everything should be fine.

46. Why are HUD properties easier to flip than short sales?
HUD properties usually have no resale restrictions. And, if so, you may flip them on the same day versus possibly being subjected to bank resale restrictions on REO or short sale transactions. For HUD transactions, you should make it clear that our funds are a loan as opposed to cash. And, you should bid on HUD properties as an entity, since we only fund entities. Note: A title company must be approved by HUD to handle HUD transactions.

47. If I don’t have a property to buy, or an end buyer to sell to, can you help me find them?
Unfortunately, no. We only lend to investors/borrowers who have already found their respective sellers and qualified end buyers.