Pretty Boi Estates backup funding system for lender shortfalls

Pretty Boi Estates backup funding system for lender shortfalls

When the 24% lender funding falls short of covering seller payoff and reserves, Pretty Boi Estates uses a layered backup system: 1) Verify recorded price covers payoff, reserves, closing costs; 2) Apply premium valuation (30–40% above recorded price) to increase underwriting; 3) Restructure seller payoff into 6–12 months of structured deferred payments tied to recorded price (no seller carry); 4) Bring in secondary Category-2 lender behind primary lender secured by premium valuation; 5) Use operations-forward stabilization reserve in escrow; 6) Reserve projected NOI (90–120 days) escrowed to close gaps for cash-flowing assets; 7) Final fallback is deal resizing to ensure seller payoff ≤ 85% minus 24% lender. This ensures title-directed, fully funded, compliant deals with no outside cash or seller carry.