Fund & Grow Financing

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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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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  • Valley Park, MO · Member since 2017 · 4 posts · 8 votes
    8y

    October 13th - Registered with Fund and Grow

    October 20th - Initial 1 hour consultation, they determined that I needed to wait until November 1st to apply for any cards because my last personal credit card would be 6 months old on by then.

    November 1st - they started the application then delayed by a week because my birthdate needed to be corrected for one of the credit reporting agencies. This should have been caught well before November 1st, since they (fund and grow) pulled my reports prior to the initial consultation.

    November 6th - resumed application process Card #1 approved with 9K limit, Card #2 approved with 11K limit, declined for 1 card, 2 cards were up for review.

    November 17th -Increase for card #1 declined because of I have a personal card from the same issuer and got an increase on the personal account 4 months prior (shouldn't the "experts" at Fund and Grow known that), Card #2 did a second hard pull on my credit and declined the increase.

    November 24th - Declined for another card, they called a couple of time and left messages, I forwarded the info to Fund and Grow, I got the impression that they felt the application was fraudulent

    At this point - I just want to get these hard inquiries off of my credit reports and pursue other means of funding. I don't think that I will get much more credit limit from the fund and grow process. My credit score is over 800, I think that they knew/should have known, Card #1 would not be eligible for an increase. I also think that the person working my applications is a trainee(or just not good at their job). I also think that I may not have been a good candidate for their program, and they should have been upfront and said something.

  • Investor · Honolulu, HI · Member since 2016 · 362 posts · 93 votes
    8y

    @Justin Sheley even though the cards are 0% interest for the first year, did you still have to make monthly payments towards them or did you pull as much money as you could and paid them off in full after the refinance?

  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    8y

    I do have to make monthly payments on them while I have the funds on the card. The rehab I just finished took 3 months, so I made 3 payments and then paid the card off. I factored those payments into my refinance.

  • Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    8y

    @Stacy Houston I have nothing but a good response and timely answers from my guy. Sucks that you’re having some issues. 

  • Investor · Honolulu, HI · Member since 2016 · 362 posts · 93 votes
    8y

    Thanks @Justin Sheley. Super informative post.

  • Investor · New York, NY · Member since 2017 · 22 posts · 4 votes
    8y

    After "eating popcorn" and reading this entire thread I can honestly say this is one of the most informative posts thus far.  @Justin Sheley I 100% commend you for being honest in your experience with F&G.   I believe the key here is to remember to be financially responsible, remember this is not free money, and ALWAYS have an exit strategy with any real estate investments.  In addition, do not get lazy about removing those hard inquires from your personal credit.   With that being said, a $3K investment is a great way to get into the game and obtain access to funds while building your business credit at the same time.  Thanks for everyone's input and much success to you all! 

  • Contractor · Los Angeles, CA · Member since 2015 · 887 posts · 323 votes
    8y

    @Justin Sheley

    In reference to your 'working on my business instead of in my business' statement I would recommend the following book: The E-Myth by Michael E. Gerber. It talks about what you just mentioned. Hope it helps. Awesome to hear about the success your having. All the best to you.

    Jorge

  • Real Estate Solutions Provider · Baltimore, MD · Member since 2014 · 571 posts · 452 votes
    8y

    @Justin Sheley Thank you so much for sharing your experience.

    How did you finance the acquisition ($30k)?

  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    8y

    @Account Closed Thank you for the recommendation, I’m actually in the process of compiling a lost of books for my Christmas present, so I’ll add that to the list.

    @Eric H. I used a commercial loan for the original 30k purchase price. So I did have money tied up in the down payment and then the rehab until I was able to refinance.

  • Real Estate Solutions Provider · Baltimore, MD · Member since 2014 · 571 posts · 452 votes
    8y

    @Justin Sheley Are you refinancing  using that same commercial lender you used to purchase? Are you refinancing into 30 year mortgages or using the 5yr arm product? If you are using the 5 yr arm, what is your plan in 5 years?

  • Rental Property Investor · Estero, FL · Member since 2016 · 195 posts · 105 votes
    8y

    Would this strategy work with traditional financing on turn key properties?

  • Philadelphia, PA · Member since 2017 · 1 post · 1 vote
    8y

    Hello everyone. After reading this whole thread about 10 times just to make sure I didn’t miss any kind of information about Fund&Grow I am not sure if I should be happy or upset. I have just signed up with them and I have an initial consultation setup for Dec 13th. I know they promisse up to $150k but I haven’t read a single post here to back this promisse. So you guys think I should be expecting aroung $20,000.00 to Line of Credit? I was really hoping that this would be the “Real Deal”

    Thanks in Advance for the response.

  • Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    8y

    I know someone that got $80k first round, she had a 790 credit score and no other real debt. So I wouldn’t be upset. It’s hard to really promise on a number set. 

  • Valley Park, MO · Member since 2017 · 4 posts · 8 votes
    8y
    Originally posted by @John P Lemes:

    Hello everyone. After reading this whole thread about 10 times just to make sure I didn’t miss any kind of information about Fund&Grow I am not sure if I should be happy or upset. I have just signed up with them and I have an initial consultation setup for Dec 13th. I know they promisse up to $150k but I haven’t read a single post here to back this promisse. So you guys think I should be expecting aroung $20,000.00 to Line of Credit? I was really hoping that this would be the “Real Deal”

    Thanks in Advance for the response.

     As long as you don't have high expectations and don't take their word for most of what they say, you should be fine.  I had a bad experience, we were able to come to an amicable agreement.  When their Customer Relations Director contacted me, she said that they were under staffed and they were hiring more people.  I do know of people that had great experiences with Fund and Grow.  I personally feel that I wasn't a good fit, and I had to jump through hoops to get anywhere after receiving unsatisfactory service. 

    GoodLuck.

  • Queens, NY · Member since 2014 · 73 posts · 12 votes
    8y

    I didn't have a good experience with them. I have to get a refund.  They wasn't  straight  forward with me.

  • Buda, TX · Member since 2008 · 1 post · 1 vote
    8y

    @Justin Sheley

    Justin, after 7 months using fund and grow, you are saying that you still only have 29k in business credit? I know that last year I was able to pull 55k in credit myself. My cards are turning into interest bearing cards so I was going to turn to my wife's credit. Hearing about Fund and Grow from many Real Estate professionals, I signed up today, but the consultation isn't until January 2nd. Now I am torn on whether or not to pull from my wife's personal credit and then start building my own business credit on my own. My thought was that within a year I should have at least 100k in business credit per person, but if after 7 months, you only have 29k, then I should be able to complete this on my own. I signed up, but I know they do a 60 day money back guarantee (hopefully not a hassle).

  • Investor · Fort Myers, FL · Member since 2017 · 40 posts · 65 votes
    8y

    I'm about a week and a half into my second round, and I hit $91,600 today.  Their customer service wasn't the greatest at first and you don't get the funds as fast as they advertise, but now I do have a substantial amount of funds I can play with in the new year to grow my portfolio.

  • Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    8y

    I’m getting ready to hit my second Round also, so I’m excited to see what happens. @Corey Robinson how much you get first round and what’s your FICO score now?

  • Investor · Fort Myers, FL · Member since 2017 · 40 posts · 65 votes
    8y

    @Maurice Colbert I received $40K, or so the first round and my FICO is 790 but when I first applied it was 707.  Went through Kaydem Credit to clean some things up on my credit so I would be stronger the second time around.

  • Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    8y

    @Corey Robinson yes I’m sitting at a 793, I cleaned it myself so yes I’m praying for a nice 2nd round. First round was $35k

  • Investor · Fort Myers, FL · Member since 2017 · 40 posts · 65 votes
    8y

    @Maurice Colbert You'll be good bro.  We have pretty similar stats so you shouldn't have anything to worry about.  I'm just hoping to squeeze in another round.

  • Rental Property Investor · Blacklick, OH · Member since 2015 · 111 posts · 80 votes
    8y

    @Corey Robinson yeah I wasted a few months trying to get the inquires off. 

  • Justin SheleyBusiness Member
    OP
    Investor · Rockford, IL · Member since 2016 · 94 posts · 220 votes
    8y

    @Josiah Wilson The fact that I have the 29k still is really on me. I have not proactively gone after a second round. I have had some changes as far as private investors, and haven't been as motivated to go after the credit. I was carrying some debt that I have since refinanced out of when I first applied with Fund and Grow, so I think that really affected the amount I was able to qualify for. I also can do a round under my wife's name, but just have not done that yet.

  • Valley Park, MO · Member since 2017 · 4 posts · 8 votes
    8y
    Originally posted by @Josiah Wilson:

    @Justin Sheley

    Justin, after 7 months using fund and grow, you are saying that you still only have 29k in business credit? I know that last year I was able to pull 55k in credit myself. My cards are turning into interest bearing cards so I was going to turn to my wife's credit. Hearing about Fund and Grow from many Real Estate professionals, I signed up today, but the consultation isn't until January 2nd. Now I am torn on whether or not to pull from my wife's personal credit and then start building my own business credit on my own. My thought was that within a year I should have at least 100k in business credit per person, but if after 7 months, you only have 29k, then I should be able to complete this on my own. I signed up, but I know they do a 60 day money back guarantee (hopefully not a hassle).

     It's hard to try to get a refund after you are approved for credit that they apply for on your behalf.  I eventually got a refund, but I had to jump through hoops. 

  • Investor · Honolulu, HI · Member since 2016 · 362 posts · 93 votes
    8y

    @Maurice Colbert and @Corey Robinson, how were you able to pull the hard inquiries off your credit history? That seems to be the game changer for those who attempt to go for a second round and maybe even their first round. I've had a couple of hard inquiries that I'd like to erase from my history so that I may have a better chance at applying for something like Fund & Grow.

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