Beware of Finance of America

5 Replies

Hello Fellow Investors,

Just wanted to put a word of caution out there about Finance of America Commercial. I recently was approved for a LOC of 2.5 million BUT quickly discovered they are selling a bag of goods that they don't deliver. The LOC was easily approved within 2 weeks -- albeit a lot of documentation was needed. I then proceeded with a new construction loan and was told that my closing date was easily doable. I sit here 6 WEEKS after they have received my application and they have not closed. There was NO communication at all after the LOC was issued. They just blew right past the original closing date with ZERO communication, I then voiced concerns, and was told I would get answers which never happened -- I then reached out to management and finally started to get some communication. Then there was the appraisal. I was contact by 3 different appraisers who had no idea what they were appraising -- which was a vacant lot and a yet to built new construction home. When the appraisal finally came in it was SIGNIFICANTLY lower than expected (and I have sold many of these homes already this year, so I have the value pretty dialed in). They used comps from 8 months ago!!! Additionally, get ready for the fees! They will sell you on the "lower rates & points" , but the fees make them as or more expensive than other HML's. Finally, I just canceled the loan and am not even interested in trying to utilize the LOC. They are not a good fit for any investor trying to scale their business -- you will lose deals as they drag their feet. If you are a new investor STAY AWAY! Luckily, I have other HML's that I use for construction financing and am already off to the races with them. The only reason I spent any time with FOAC was b/c of my business scaling this year and trying to increase the number of lenders I work with. Hopefully, this will save some of you from the headache!!

Promotion
Sharestates
America's Private Lender
Receive Fix and Flip Funding Approval In As Little As 24 Hours!
Sharestates helps developers and brokers secure funding quickly with the most competitive terms.
Get Funded

@Amanda Williams

Sorry to hear about your experience, but thank you for sharing with the community. FOA is an approved lender with us. I used them once... never again. There are many very reputable lenders who can offer LOC at very reasonable terms. I know a few if you are interested...

Cheers!

@Amanda Williams

Sorry to hear about your experience. To jump on the gripe train, I used FOA early in the year and they were incredibly slow in underwriting. We had to push back our closing date twice. The seller's agent, us, our agent, and even our loan officer were bombarding them with phone calls trying to get them to get their act together.

Originally posted by @Jeff He :

@Amanda Williams

Sorry to hear about your experience. To jump on the gripe train, I used FOA early in the year and they were incredibly slow in underwriting. We had to push back our closing date twice. The seller's agent, us, our agent, and even our loan officer were bombarding them with phone calls trying to get them to get their act together.

this is very common low ball you on points and rates making you think you have this smokin deal.. then when your HUD comes in there are thousands upon thousands of dollars in junk fee's .. these lenders dont have to disclose this until the hud is prepared and that is usually these days not until the day of or day before closing.. I did a deal with a flipper in LA with one of the big named socal HML and when i got the hud.. they had 800.00 for tax service company ( IE make sure you pay your prop tax's) WTF on a 9 months loan LOL.. junk fee's made the closings costs on this loan double the points..