Gap Funding from EAC

[Kevin Yoo]

This past week, EAC Community invested $150,000 in gap funding request from a San Diego rehabbing company. This company is a very well-established company with a long track record. We had been discussing with them on providing gap funding for their rehab projects for many months. This property 2420 Upas Street, San Diego, CA 92104 has been seen by our EAC Team and found to be an excellent prospect. It needed gap funding because their original investor backed out at last minute. This property was purchased for $855,000. The rehab should cost $110,000 and final sales price should be $1.2M. The company plans to cash us out early for cheaper money or keep us in the deal till the end and projects the funds will be needed for 3 to 6 months. 

We have negotiated an annualized return of 36% for the gap fund. The $150,000 came from two Preferred Investors and two Managing Partners. These four Investors will receive 24% annualized return and EAC will receive the remaining 12%. Due to the availability and ease of use of EAC capital, this company plans to use us more in the future.

Having the financial backing of our Community Investors allows us to essentially serve as a bank to underwrite very safe and high yielding projects. EAC Community is constantly looking for real estate projects to invest in throughout the country. We are not a HML and will not charge any points or have carrying costs. We will fund part of or the entire deal. We are not cheap but very easy to use and dependable.