Fund & Grow Financing

Creative Real Estate Financing
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Fund & Grow Financing

Justin SheleyBusiness Member
Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes

After listening to the Clayton Morris podcast (EP115 with Mike Banks) about the company Fund & Grow, I became intrigued with the idea of using business credit cards to buy rental properties using the BRRRR method. The whole concept seemed too good to be true, so I hopped on BiggerPockets to see what people were saying about Fund & Grow. I always find great content here, and more often than not I find the answer to my question before I even need to post and ask about it. However, with Fund & Grow, I didn't find much. (If anyone knows of a discussion about Fund & Grow that I didn't find please link me to it) There are a few discussions where people were considering using Fund & Grow to finance a deal, but none that I saw that went all the way through the process and used the funds to find a deal.

That being said, I decided to start this discussion post and share my experience with the company from day 1 till I refinance and hopefully complete the BRRRR method.

For anyone not familiar with Fund & Grow, they are a company started by Ari Page that helps you establish business lines of credit for the purpose of creating working capital for small businesses. In my case, I will be using the line of credit to buy properties in Rockford, IL and rehab them into rental properties.

Phase 1:

Currently I have enrolled with Fund & Grow and completed my initial consultation. This cost $3,000 for their service of negotiating and securing the business credit cards. I spent 1 hr on the phone with a very friendly consultant and discussed my plans for the business credit and established a sole proprietorship for both my wife and I. This allows the business lines of credit to not affect my personal credit score.  The first push for business credit will begin next week, and I should have access to an anticipated 60k by the following week. My wife is not currently receiving accounts yet until a more established credit history can be created for her.  We are currently lining up several refinancing options with banks in the area so that they are aware of what we intend to do. Currently we are being told that we can refinance the properties we buy with cash after 6 months. This is key for us, because we intend to buy and hold these properties and do not want to get stuck after the initial 12 months of 0% interest expires on our business credit cards.

Phase 2 is going to be actually receiving the cash into our account and making our cash purchase. I tried for brevity sake to not go into the entire Fund & Grow concept in my initial post, but if anyone has any questions, comments, or concerns I'd love to discuss them.

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Drew Cameron
Lender · Peabody, MA · Member since 2015 · 82 posts · 49 votes
9y
I used a similar system to receive roughly $40,000 in credit cards at 0% for a 12 month period. The company I used took 10% upfront and then helped me liquidate everything so I had usable funds fairly quick. I was able to do a flip with the funding I received and pay back all the money before my interest free period ran out. It was expensive, but the flip more than covered everything and I was able to get in the game. I would do it all over again if I had to.
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  • Steve Racicot
    Investor · Manchester, NH · Member since 2016 · 164 posts · 83 votes
    9y

    I would like to hear a successful story of someone actually taking cash from the credit lines.   This is the piece that seems to be missing for me...

    4Reply
  • William C.
    Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes
    9y

    @Steve Racicot your right.  It's been touted that there are ways, but after reading the entire thread I have still yet to see one.  Maybe Micah can bring some value to this convo?  Let's hear a story about how to turn the CC into cash?  

    0Reply
  • Micah Markowitz
    Financial Advisor · St Louis, MO · Member since 2016 · 25 posts · 44 votes
    9y

    Repost from a post I made above, 10 days ago.  I thought it was adding to the conversation...

    Just for those who are curious a very legit way to get money off the credit cards, find a "no fee on cash advance" credit card. Request a cash advance, start paying interest, but make a balance transfer from one of the cards to pay it off immediately and you won't pay any interest.

    You should try to find one with a high enough limit to make it easy enough to do (not $just 500/advance!). Use it like an ATM. Totally legit, completely legal.

    This link in 5 years from now will for sure be useless, but I'll post it for us for the "now." It's of the first ones that came up with Google.

    http://www.magnifymoney.com/blog/best-of/20-credit...

    http://www.thesimpledollar.com/credit-cards-with-c...

    You can also use your HELOC, if you're lucky enough to have one. Take money out, put money in. There are those that discussed Gold and Bitcoin in the past. I'm sure F&G and MWCC have a laundry-list of ideas. "Manufactured spending" was also mentioned here in these posts.

    1Reply
  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    9y

    So here's an update on how things with Fund and Grow are going for me.  I haven't gotten a reply to an email with my F&G rep in about 2 weeks. I am supposed to be getting instructions on liquifyig the cash and removing inquires, but have not received that guidence yet. So I haven't attempted it on my own yet.

    I've been less than thrilled with the customer service after the few initial calls. I know I'm going to make the most of this interest free money, but the jury is definitely still out on if it was worth the upfront cost. 

    I did however just get a house under contract that is going to be a perfect house for the BRRRR method. So I will be using my 29k in business credit lines for the rehab and then refinance the property. So that 29k for rehab should work out nicely for my business.

    10Reply
  • William C.
    Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes
    9y
    Thank for the update Justin Sheley No need to repost Micah Markowitz . The way these internets things work is that old posts stay on the thread. It just makes more trash to weed through to get to new, valuable input from actual consumers. Your a shill, pushing your company, anything you say is useless. You have a motive, not actual experience using these products and to valid recommendation to make about how it worked out for you.
    3Reply
  • William C.
    Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes
    9y
    Micah Markowitz , cash advance is not a sufficient way to withdraw $50-$10k from CC's. And a HELOC is not a CC, so doesn't answer the question. If we want to take a few thousand out, we are covered. How do we turn $100k into cash?
    1Reply
  • Micah Markowitz
    Financial Advisor · St Louis, MO · Member since 2016 · 25 posts · 44 votes
    9y

    @William C.

    I won't stoop to insulting or responding to insults, so I'm just going to respond to the question.  You asked me to post something productive to the conversation, and I did and I have.

    These cards provide larger cash advance options than you think.  It is some work, but they make it hard for reason.  Just because you don't want to go to the hassle, doesn't mean it doesn't work.  Not so efficient, but certainly works.  Also, I'm not so sure that these cash advance limits on these cards is so small.  Find a card yourself that provides a larger cash advance.

    Borrow from your HELOC, and then pay a balance transfer from the 0 APR cards to the HELOC. Wash, rinse, repeat. Use the HELOC as your ATM. That's what I was referring to, I'm sorry if I wasn't clear.

    1Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y
    Originally posted by @Maurice Colbert:

    Well today I pulled the trigger and paid to start the process! Crossing fingers

    Where are you now in the process?

    0Reply
  • Maurice Colbert
    Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    9y

    @Donny Aldo the first round will be sent threw mid August, waiting on a score adjustment I paid down some CC. 

    0Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y
    Originally posted by @Maurice Colbert:

    @Donny Aldo the first round will be sent threw mid August, waiting on a score adjustment I paid down some CC. 

     Thanks for the update, i thought they worked faster. It looks like it kinda takes awhile.

    0Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y
    Originally posted by @Justin Sheley:

    So here's an update on how things with Fund and Grow are going for me.  I haven't gotten a reply to an email with my F&G rep in about 2 weeks. I am supposed to be getting instructions on liquifyig the cash and removing inquires, but have not received that guidence yet. So I haven't attempted it on my own yet.

    I've been less than thrilled with the customer service after the few initial calls. I know I'm going to make the most of this interest free money, but the jury is definitely still out on if it was worth the upfront cost. 

    I did however just get a house under contract that is going to be a perfect house for the BRRRR method. So I will be using my 29k in business credit lines for the rehab and then refinance the property. So that 29k for rehab should work out nicely for my business.

     Did they ever give you a working way to liquify the money to be able to get the cash?

    I'm on the fence about signing up.

    0Reply
  • Matt Ellis
    Pittsburgh, PA · Member since 2015 · 6 posts · 6 votes
    9y

    Interesting post....

    I haven't used fund and grow (or midwest) to gain Business credit lines/cards. However, I have been lucky enough to have a pretty high personal credit card limit. I have been playing with ideas of how to get money off those personal cards for a while. Here is where I am currently at...

    This is one angle I have worked. You effectively get a 12-18 month loan for 6.5% and You get a lot of fringe benefits on the side.

    The approach I have used (not for real estate) is a company called plastiq.com . Their model is pretty straight forward. Lots of companies don't like accepting credit cards because of the fees associated with it. So Plastiq lets the customer pay the fee if the customer wants to pay with a CC and they send the vendor a paper check. They charge you 2.5% or less depending on the card you use (amex vs visa). They target people who want to pay rent on a card and small businesses paying invoices. The math is hard to swallow for most ppl... "who would pay 2.5% fee to pay their rent?? That's crazy!"   but if you are creative, you can come out on top.

    They have some strict guidelines. Can't pay yourself (that would make enemies with the bank who charges their fees for cash advances), you can't pay your mortgage and a handful of other things... However you can pay contractors for a flip....and the creative ppl here are surely able to get around the mortgage or paying yourself restrictions...

    If you were to use Plastiq up to this point and pay a bill using you are using your revolving credit (CCs) as intended. You are paying your bank the APR on your card (12-24%) +2.5% for Plastiq...

    So to drop your psuedo loan rate to 6.5%...

    While my personal cards exceeded their promotional APR periods a long long time ago... BofA seems to keep sending me balance transfer promos weekly. 0 APR for 18 month. 4% fee.

    Once you have paid your big bills on your CC, use the balance transfer promo.

    So a break down of the cost to pay something like a contractor on a rehab would be the 2.5% Plastiq fee and then the 4% balance transfer fee....6.5%..

    From a cash flow perspective, you need to make sure you account for minimum payments during the promo periods.... and a major balloon at the end.

    Some fringe benefits to the whole thing... 

    • Most cards have some sort of reward program... and category bonuses for 2-3X points on travel etc (in plastiq, you can specify what type of vendor you are paying and they will run your card accordingly...don't try to cheat it). 30K Starwood points on my Amex gets me about 3 nights stay in a 250$ a night hotel.
    • Deferred payment.. you can skip one month of payments if you time it right because of your credit card terms..  Pay Plastiq at the beginning of the period, it doesn't come due on your CC until the end of the period and most CCs have 30 days to pay your statement..
    • Technically, the 2.5% is a financing fee is tax deductible under most situations.

    Downsides to the whole thing.

    • The way I do it (not through the fund and grow business cards) is that it hits my personal credit. This skews my credit score (you can jump on creditkarma and do simulations about carrying a balance)... and because its my personal cards, it also impacts my debt to income ratio... (I actually posted a question yesterday to BP about how DTI might impact a cash out refi if all the debt was related to the rehab..no definitive answers.). So if you plan on using a conventional bank/loan then you might be in trouble ... if you are using commercial lending then it might be free and clear. All assuming you are using BRRR. If its just a flip and a sale then why not....

    There are some complaints out there about the service but it seems to be largely people who are trying to get around the system or don't understand that there are lead times... Ex: it can take 2 weeks to get the check to the recipient so you have to plan accordingly... I haven't had any problems.

    If you sign up for an account, during the registration period there is button that says "referral code"    if you use referral code  765407   (mine) it will waive the 2.5% fee for the first 500$ you send using the service (and I get the same for the referral)...  that comes out to all of 12.5$ which is nothing but every bit helps...

    Using Plastiq with a business credit card with 0% APR for promo period gets around the need to use the balance transfer...and should fix the need to be concerned about the DTI and personal credit.

    Doing it in compliance with their terms you could buy a property and  then use the CCs to fund the rehab through Plastiq (assuming your contractors don't take CCs)... Using it for the down payment or buying the property outright is out of their terms (you could probably split hairs and say that their terms of service says no mortgage payments... but buying the entire property outright could be a gray area.....)

    But...   anyone who is willing to load that much money on a credit card has got some guts... or no brains. Not sure which bucket I fall into..  :)

    Cheers

    6Reply
  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    9y

    @Donny Aldo

    At this point I'm pretty disenchanted with F&G as a company. My official representative was Robert Moran, and he has not returned an email to me in over a month. When I call in, he's always busy and I end up talking to some sort of receptionist. She assured me that Robert had not received my emails and I must have the wrong email. This is not the case, as my emails to him were part of an email thread where we had spoken back and forth previously. 

    Regardless, she said she could send me the attachments for inquiry removal in the next 5 minutes. That was 2 days ago.

    So needless to say, I'm not thrilled. I hope they can somehow salvage themselves with me and actually provide customer service, but it's not looking good.

    The only contact I've had directly from my F&G rep in the last month was a voicemail asking me to do a video testimonial for their company.

    3Reply
  • Maurice Colbert
    Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    9y
    Justin Sheley wow I really hope they didn't do you like that! I was reading way to many success stories with them. The only reason I wanted to wait till mid August so I can get a higher score when a credit card I had hit. I hate to hear they rep didn't call you back
    0Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y
    Originally posted by @Justin Sheley:

    @Donny Aldo

    At this point I'm pretty disenchanted with F&G as a company. My official representative was Robert Moran, and he has not returned an email to me in over a month. When I call in, he's always busy and I end up talking to some sort of receptionist. She assured me that Robert had not received my emails and I must have the wrong email. This is not the case, as my emails to him were part of an email thread where we had spoken back and forth previously. 

    Regardless, she said she could send me the attachments for inquiry removal in the next 5 minutes. That was 2 days ago.

    So needless to say, I'm not thrilled. I hope they can somehow salvage themselves with me and actually provide customer service, but it's not looking good.

    The only contact I've had directly from my F&G rep in the last month was a voicemail asking me to do a video testimonial for their company.

     Wow .. Speechless thanks for your honesty. This is what I was afraid of getting the run around.

    5 mins turned to 2 days? 

    At this point I'm nervous now really nervous about signing up.

    I love this forum you get real answers not webinar fluff.

    Still no concrete way to pull cash out the cards?? 

    So far it's between, fund n grow or midwestcc not sure of any other good ones out there.

    Justin I hope they make it right with you thanks

    0Reply
  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    9y

    @Maurice Colbert

    Yeah it's really frustrating. The good news is that I have a good situation right now to use the business lines of credit to my advantage, and I wouldn't have this opportunity without those funds. I am left wondering if I could have just done it myself. But to me it was worth having someone there to help me through the process. That is why this lack of communication has been extra frustrating.

    2Reply
  • Joseph O.
    Real Estate Agent · DFW, TX · Member since 2016 · 44 posts · 24 votes
    9y

    What banks are they securing credit cards from ? 

    0Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y

    updates?

    0Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y

    I spoke with Bailey at Midwest corporate credit dude was a good guy and knew a lot. Was realistic and honest with me.

    They know there stuff

    0Reply
  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    9y

    So I need to clear the air a bit with Fund & Grow. I had reached a pretty frustrated level with my rep their, and although I don't regret getting the line of credit, I was beginning to regret the company I chose to do it with. I mentioned it before but I had not received a reply to an email in over a month, and I thought I was being smart by looking in my junk mail box in gmail as well. However, as I was literally on hold to talk to my F&G rep, I opened my trash to clear it out, and wouldn't you know it was a reply from Robert Moran for every email I sent him. He was just as confused as I was, as to why I wasn't receiving his emails. So although he probably will never see this forum, I do feel like I owe him an apology. I don't understand why in the world those email would go straight to my trash. The only thing I can think of is that I had been consistently deleting the more "spam-ish" emails that F&G has been sending me. (Side note, these emails are as if their program doesn't know I've already paid for and utilized their program). So perhaps my gmail was trying to be "smart" and automatically trash messages from them. I really don't know. Regardless, that issue was cleared up, and I was relieved to know that I was not actually getting the cold shoulder.

    So at this point I do have the instructions on clearing inquires from my credit report, so I'll update you guys on how that goes. And although I am also so curious about the turing the credit to cash methods, I actually have the perfect BRRRR project right now that I'm going to use the cards for the rehab, so I don't need to worry about the transfer into cash.

    12Reply
  • Maurice Colbert
    Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    9y
    Justin Sheley that's great to hear man. I was getting nervous, because my rep she was responding to me after a day I sent the email. Good stuff.
    0Reply
  • Chuck Kramer
    Orlando, FL · Member since 2017 · 241 posts · 254 votes
    9y

    @Justin Sheley Thanks for the updates and clearing the communication issue up. We are all interested to continue hearing of your experience with F&G, increasing beyond the initial 29K and how to actually get the cash off the cards. 

    I hear you on the spam issue. I got over 100 emails in a week from them after participating in a webinar; not the actions of a typical straight-up company in my book. But not a complete deal-ender either.

    Keep the news and experiences coming.

    1Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y
    Originally posted by @Justin Sheley:

    So I need to clear the air a bit with Fund & Grow. I had reached a pretty frustrated level with my rep their, and although I don't regret getting the line of credit, I was beginning to regret the company I chose to do it with. I mentioned it before but I had not received a reply to an email in over a month, and I thought I was being smart by looking in my junk mail box in gmail as well. However, as I was literally on hold to talk to my F&G rep, I opened my trash to clear it out, and wouldn't you know it was a reply from Robert Moran for every email I sent him. He was just as confused as I was, as to why I wasn't receiving his emails. So although he probably will never see this forum, I do feel like I owe him an apology. I don't understand why in the world those email would go straight to my trash. The only thing I can think of is that I had been consistently deleting the more "spam-ish" emails that F&G has been sending me. (Side note, these emails are as if their program doesn't know I've already paid for and utilized their program). So perhaps my gmail was trying to be "smart" and automatically trash messages from them. I really don't know. Regardless, that issue was cleared up, and I was relieved to know that I was not actually getting the cold shoulder.

    So at this point I do have the instructions on clearing inquires from my credit report, so I'll update you guys on how that goes. And although I am also so curious about the turing the credit to cash methods, I actually have the perfect BRRRR project right now that I'm going to use the cards for the rehab, so I don't need to worry about the transfer into cash.

    1Reply
  • Donny Aldo
    Houston, TX · Member since 2017 · 23 posts · 6 votes
    9y

    Thanks for clearing the air, I don't think there bad ppl they just might over promise?

    Either way you won because you got the money to rehab your flip congrats.

    0Reply
  • Michael McKenziePro Member
    Lender · Cary, NC · Member since 2016 · 82 posts · 13 votes
    9y

    Hey All I do business with MWCC awesome company. @Jeff Schechter would like to hear your story since you have used both.

    0Reply
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