[00:00:00] Speaker A: Welcome, listeners. Welcome, listeners. You're listening to the deeds in the desert, the place where real estate investors tune in for the latest news and available investments at Ignite funding. If you're on the hunt for a low effort passive income stream, then turn up that volume and pull out the hammock. As we get ready to feed you your weekly dose of real estate investing insights.
[00:00:29] Speaker B: Welcome to another episode of Deeds in the desert. I'm your host today, Izzy Irazari. Today's guest, we have Misty Bethany, chief compliance officer. Let's get right into today's topic. I'm really excited for this one. The episode itself is called Docs and funds. What's the worst that can happen?
[00:00:46] Speaker C: Everything.
[00:00:48] Speaker B: Yeah, this is going to be a hot topic, right. So let's just start off from the beginning. Before we even talk about, like, docs or sending in funds, let's talk about when we release a loan.
[00:00:59] Speaker C: What? The chaos ensue. Yep.
[00:01:01] Speaker B: So from the moment underwriting decides that we're going to do a loan and they write up what we call a fact sheet, many of our current clients know what that is. Fact sheet has all the facts on it. It is then approved by Misty and her team to make sure that everything is compliant. From there, we then go out onto the sales floor and Pat decides to tell everybody exactly what they need to know in regards to the loan.
Once Pat is finished talking about the new loan release, we then get marketing involved. For those that don't know, we have a tech subscription service that allows those clients that are opted in to learn about the loans the fastest. Why? It's faster than email, and it's faster than all of us trying to get on the phone and calling the thousands of clients that we have. So the text message goes out. Clients are able to see the PDF form of the fact sheet, and they're able to learn everything they need to know about the new loan from there. Some of our clients are very diligent. They tell us exactly what account they would like to invest in. They'd like to invest a specific amount, and they always let us know to please send the documents as soon as they are placed. It's pretty simple. That's usually our first form right there. But from that point, that is when the chaos does ensue. Misty and her team are then having to basically, at that point, take all the orders from hundreds of different messages, and we're trying to keep up as much as we can with that. And it's not a bad thing, but the one thing I always like to tell people, I always use the DMV. For instance, for those that hate the DMV and for those that love the DMV.
[00:02:32] Speaker C: Who loves the DMV?
[00:02:33] Speaker B: I don't know. People who make appointments.
But when you go to the DMV, you pull a number, and that's your number. Right? You don't go up 20 minutes later waiting for them to call your number to go pull another number and then another number that doesn't do anything for you.
The first number you get, that's what you get. Well, it's the same thing when you respond to a text. If you don't feel like you got responded to accordingly, then you're going to email. And then after you email, then you're going to call. Just so you know, your position is the same, no matter whether you're trying to hit all corners or just one corner. So we always urge everybody, if you are on the text message, please go ahead and just respond. Let us know your account number. Let us know exactly how much you're wanting to invest. Oh, and by the way, if we send out two, three, four loans, let us know which loan you're wanting to invest in from there. So, Misty, we get all those placements in, right? All the docs are starting to go out now. Is this where the time starts to tick for the investors?
[00:03:33] Speaker C: So, yeah, the minute you send out that text, we have hundreds. Right, of investors that all got it at the same time, and they're all responding to us at the same time. And there are at least eight people taking orders in various ways. Right. And add to that you and I as backups, that's ten people, believe it or not, takes all of us, and all of those requests for placement are coming in simultaneously in various ways. And what really causes chaos is, like what you just said, the individuals that text, email, call, walk in, walk in, call again, call other numbers, call back end numbers to try and get through. We are going to get to you, I promise. And it may seem, especially when a hot loan like last week drops, right?
[00:04:26] Speaker B: Yeah, last week. Yeah, that was a very hot loan.
[00:04:29] Speaker C: It may be frustrating because you're wanting to have confirmation that you got on the loan. We will get to you.
Please give us time to get through to everybody. So you mentioned it earlier, text allows simultaneous release rather than us having to call or email each investor individually. Well, you're all responding at the same time. So just understand we're humans taking those requests and we are going as quickly as possible. And you will hear from us even.
[00:05:03] Speaker B: If it means you're on the waitlist.
[00:05:04] Speaker C: Even if it means you're on the waitlist, and if you are on the waitlist, then that just means that that's how many people actually truly came in ahead of you in that ticket taking scenario that Izzy described.
[00:05:18] Speaker B: So, Misty, why is it so important for people to abide by the set parameters we have in terms of getting their docs in within five days of being placed and getting their funds in?
[00:05:30] Speaker C: Yeah. So you mentioned something a little bit earlier. You talked about the fact sheet, which has all the facts.
[00:05:35] Speaker B: Yes.
[00:05:36] Speaker C: One of the key facts that probably goes unnoticed because it's not the sexy part of a fact sheet. Right. Is the funding date. So if a funding has not occurred yet, it is very important for you to pay attention to that date, because not only do we have to have all docs in advance of that date, but we have to have funds and they have to be cleared before that date.
[00:06:01] Speaker B: What do you mean by that?
[00:06:02] Speaker C: Cleared. Cleared. Yeah. So basically, your bank needs to have cleared those funds. The only way to ensure that we have clear funds on the same day that you send the funds is a wire.
Now, if you're sending a personal check, just know that we have to take four days for our bank to clear those funds. The funds will indeed leave your account the day that we deposit, but four days is what's required to clear them and make sure they're good funds on the day that we fund.
[00:06:33] Speaker B: Because we've seen some things happen in the past. Sometimes it's not the investor's fault, it's just money passing through.
[00:06:39] Speaker C: Could be a bank error.
[00:06:40] Speaker B: Yeah, sometimes they may not have enough funds in that specific account either or. Sometimes people may make a decision where they want to cancel it. Those are various things that we need to be prepared for to ensure that we are ready for funding.
[00:06:52] Speaker C: And one thing that's important to note is there's protection. So I'm going to take a step back and go a little bit compliant on you guys. So we have trust accounts. So when you send funds to us, you're not sending those to ignite funding for us to do whatever we like with, they are going to ignite funding. Capital trust account. The funds that come into that account are solely investor funds, and those are the funds that are sent out to the borrower to fund a loan. That's the only purpose of that account. So some investors think, well, it's okay, ignite could just cover me. Well, ignite cannot commingle funds. So in order for us to fund a loan. We have to have 100% of the funds for that loan in that account on the morning that the funding is set to occur.
[00:07:45] Speaker B: I mean, for a real life example, let's actually bring up Albion, the loan that we released last week. That one was a bit of a doozy for some of our clients, especially even for an underwriter. I remember when I was talking to Pat outside, when he was talking about the loan, he said in his whole entire time here, we've never seen a loan of that nature, regardless of just the terms. But the yield that it was providing, 15% yield. I know it's short term, only three months, but still, that's a significant yield. But why did we do that? Because we needed to raise funds very quickly.
[00:08:17] Speaker C: Very quickly.
[00:08:17] Speaker B: We had to. And so that was the kind of the double edged sword. We knew we had to do it. What was the way that we were able to do it? Well, we know investors like higher yielding loans, so that's pretty much why we did it. But at the same time, for that higher yield of 5%, more typically what investors get, we did expect to get everything in, in time. I know it may have seemed like your team was hounding people.
[00:08:42] Speaker C: We were definitely badgering some people. And I think it came as a shock to a few investors who've been with us for a long time, because we did have to be harsher than we have been, less lenient. So for an investor, for example, who may have normally mailed us a check and waited for it to clear, we couldn't allow that, because it wouldn't clear in time to fund. Same thing with following up on the documents and then right down to the wire, no pun intended, of investors who are used to just going into the bank and making a deposit. Well, we had to say, no, we can't accept your deposit today. It has to be a wire because it has to clear so we can fund first thing tomorrow morning. And for the most part, investors understood. But I think there was some frustration in all of that, because for those investors who couldn't, for whatever reason, meet those strict timelines, they did miss out on that loan.
[00:09:42] Speaker B: I think that's something that we just need to do a better job of reiterating consistently, because I know you mentioned they are on the fact sheets, the dates are on there and everywhere that we post new loans. We do let everybody know, you have five days from the moment you replaced to get this in. And I know, frankly, for some people, it is harder who don't have certain banks in their area. Who do live out in the outskirts in their respective regions, but at the same time, five days, that is a good amount of time. We get it. Some things happen. You miss out on various things, but I think we are very accommodating in many ways to how we accept funds, but also in which how we ensure the clients are getting their docs in. I like being reminded. There's so many things that I like being reminded because we have so many things going on in our lives and so it's hard to remember sometimes. Like, oh, I do need to get those done. So I think it's great that your team does remind people, whether it's via email or calling them, because at the end of the day, we're just trying to get you guys on a loan. We're trying to get them invested, get you earning interest. Yeah, definitely.
[00:10:40] Speaker C: Absolutely.
[00:10:41] Speaker B: So let's go over a little bit more of the topic of this episode. Let's say I get my docs in and I get my funds in. What else could go wrong at that point?
[00:10:49] Speaker C: Well, so maybe you've done your docs, you've done the esign. That's great. And you see a notice come out that says something's missing. So we're very clear about that. If you sent it in, you'll see that on the email. Go ahead and disregard this notice. Here's what I'm going to say to you. If you get it the next day, please call us because something has gone wrong. We're very good about getting everything checked.
[00:11:13] Speaker B: In that same day. Yeah.
[00:11:15] Speaker C: And a lot of what can go wrong is the Spoa.
[00:11:18] Speaker B: Yes, I've seen that. Yeah.
[00:11:20] Speaker C: Yeah. We partner with an online notary company. And here's what can go wrong. We have a link every time you get the Spoa from us. When the docs go out, there's a link there. But if you invest with us a lot, you may have been tempted, or maybe you have created an account with the online notary.
I highly recommend you don't do that, as counterintuitive as that may seem. Here's why. Number one, if you don't use the link each time, you won't get the pricing discount that you get through. Coming through ignite. But more important than that is, if you don't use the link and you create an account, the company doesn't know that that's coming through to ignite.
[00:12:04] Speaker B: Yeah, I didn't know that. Okay.
[00:12:05] Speaker C: What happens is we don't get a copy of that then, and you will get a copy if you get a copy of your SPOA, please automatically forward that to us. And it didn't go through the ignite link. So next time make sure you use the link. But if you get a copy, that's your number one clue that we didn't get it right. They only sent it to one a lot of times, too. They just may have not sent it to us. And in that case, I will say this, we have a great relationship with them and we can go in on our side and ask for it and they usually send that to us. But that's one of the things that can go wrong is the online notary.
[00:12:46] Speaker B: Actually, I think the other thing I've heard too, several times is that sometimes it's really not anybody's fault because they don't even know this. So we'll let everybody know now is they forget to pay at the end of it. They forget completely to pay. And I guess that happens after. Once the documents have already been signed, it happens after.
[00:13:05] Speaker C: And so we'll go in a lot of times and we'll look and we can see that it's just pending payment. And so we'll send a reminder. Again, we have a great relationship with them and they allow us to do that, send the payment reminder. So, yes.
[00:13:21] Speaker B: I think the other one, too is that some people will miss one of the emails because they do come out consecutively. Once you're placed on an investment, they get their esign docs and the SPOA and some people are only looking for one. And then they respond to us like, hey, I didn't get this. But they didn't realize that they're actually both going out at the same time.
[00:13:39] Speaker C: Yeah. And then the other thing is sometimes they miss it because the SPoa will come and it'll show that it's from correct. Whereas the esign docs come from Adobe, from echo sign. So a lot of times we get calls saying, hey, I never got my esign. We'll go in, we'll push a reminder. But the key there is we just always remind people, remember, it's not going to come from ignite.
[00:14:00] Speaker B: Correct. That goes for a lot of our new investors, too, especially those who are maybe on their first or second investment or those who haven't even made their investment yet. Be on the lookout for that. Like Misty did state, it does come from adobe. The subject line typically reads signature requested for the specific loan that you guys are going on. So keep an eye out on those. And once you do get one of those, or let's say it originally went to spam. Please mark them also as a safe sender on top of any of the ignite emails that you get, just to make sure that you are getting those every time. I know emails are very spam stricken now and people are just like, I don't want this, but make sure that if you do see those and you are making investments that you do mark those as a safe sender. I think those are really important.
All right, Misty, have you got anything else on what's so important about the documents and funding?
[00:14:45] Speaker C: Yeah, so the other thing is, let's say that you get an SPOA done through your bank and at the same time you're doing your deposit. Please always make sure to send us a copy of that receipt. And if you are sending in multiple documents, it's best practice to not combine those into a single attachment because we're humans. We may miss one of the pages, but if you do, that's okay. But in the body of your email, if you would just list out what's attached there, then that helps us to make sure we have properly checked everything.
[00:15:24] Speaker B: In, especially those clients that go on three, four, five loans at a time.
[00:15:27] Speaker C: Yeah, exactly.
[00:15:28] Speaker B: I think the other thing too is I think people also have a misconception on getting their docs and funds and everything in on time. But when do they start earning interest?
The reason why is because we're getting ready to fund a loan later this week. Right. And some people may have already sent their stuff in yesterday for Monday or Tuesday, whenever it was and it's prior, but they're thinking, oh, well, you have all my stuff, I should be earning interest.
[00:15:55] Speaker C: Right.
[00:15:56] Speaker B: There's always a difference. We actually have a great episode on that about originals versus assignment loans. So if you want to dig a little bit deeper into that, go ahead and check back on deeds in the desert on the platform, you're viewing this, and then you guys can go ahead and learn a little bit more about originals versus assignments. But that is something that people need to make sure of, is some of our stuff is on an original investment as well as an assignment. And that does dictate when the interest does start for them.
[00:16:18] Speaker C: Yeah, and that's a good thing to talk about too, in terms of assignments and what that means for when your doctor due. But to answer your question, when they start to earn interest is when the borrower has access to the funds so the loan is funded. So in the case of an original funding, the day that the loan funds is the first day that investors will start to receive interest if they are assigned onto the loan day for assignments. You are assigned onto a loan as soon as your docs and your funds are good and clear and you actually start earning interest the very next day that that happens. The reason being is keep in mind you're assigning somebody out of that loan, so that person that's being assigned out earns interest on that first day that you're assigned onto the loan.
And then that brings up a good point. I talked earlier about the fact sheet and looking at that date. If the date is in the future, then you know you're going on an original or you have the ability to go on an original funding. But if the date's in the past, what does that mean and when are docs due? It means the loan has been pre funded and so you're going to actually go in as an assignment, and that's when the five days really applies. Because there may be times where we are doing an original funding on a loan and there's not five days.
[00:17:38] Speaker B: Correct.
[00:17:38] Speaker C: It might fund in two days or three days, which means we need your docs same day along with funds which would in this case be a wire. So that's kind of the difference there and something to look for on that fact sheet.
[00:17:52] Speaker B: I think the other thing, too, is that I just heard about this the other day from a client when I was on the sales floor. I was interesting, apparently some of the smaller banks take a little bit longer to actually get the wires out.
[00:18:04] Speaker C: Yeah.
[00:18:05] Speaker B: So I was really shocked by that. I was talking with one of the sales reps and they were like, oh, did you know this specific bank may get the wire, but it doesn't even go out till the next day. So there's a lot of things that go into play that you may want to understand with who you're banking with. Also ask questions. That goes for us and for the people that you're banking with is how soon is this going to get there? Because like you said, we do have cut off times they have to be in and there's no if, ands or buts about it.
[00:18:33] Speaker C: Right. And that's another good point. And something that actually happened last week is that we had reached out. It's the day, the cut off day. So we reached out to somebody on the waitlist. We do call those people, many of you know, because you were contacted last week and said you can get on this loan, but we have to have your docs and a wire today by x time. Well, the individual went down to the bank to complete the wire, just as he was instructed to do by one of our client services reps. And the bank talked him out of it and said, you don't need to do a wire, you can just do a deposit here and it'll be good funds for them same day. Well, that is not true in the sense that, keep in mind, we have to have everything buttoned up and ready the night before funding occurs. How our bank works is if you're doing a bank of America to Bank of America deposit, yeah, the funds are good funds that same day. But guess what? We can't see them in our account. And if we can't see them, we can't check them into your account.
[00:19:37] Speaker B: So it's not like a real time transfer where some people are used to sending from their own checking to another checking. It doesn't work that way.
[00:19:43] Speaker C: Please don't let the bank talk you out of what we've told you.
[00:19:47] Speaker B: I think some clients just need a reminder. Some clients don't know, especially the clients have been with us a very long time who have been with us maybe ten plus years. They've seen the policies change, they've seen banking change and all these various things. But I think it's very important that we just reiterate it as much as we can. New investors, investors who've been with us quite some time. It's important regardless, because at the end of the day, all we're trying to do is ensure you are compliantly getting on a loan and that we have everything that we need to ensure that we fund that loan, which then will allow us to then provide the borrower with the funds and we can get the ball rolling and people can start earning their interest.
[00:20:25] Speaker C: Absolutely.
[00:20:26] Speaker B: Do we want to drop a little tidbit about what we're working on right now for next year? I know it's going to be a game changer. We haven't even actually got this approved yet, but why not? Let's just talk a little bit about it. But we're always striving to streamline the process here at ignite funding. And Misty and I do a lot of working together over the last couple years, and we've figured out different ways that we can streamline the process of investing and ensuring that nobody is missing out on loans. And one of the things that has become a headache is checks. Checks have honestly been a little bit mailed. Checks, correct. Mail. Checks have been very hard, and we're trying to figure out a way that we can either phase that out or offer another option to our investors so kind of want to just throw that out there. No decision has been made yet, but we are playing around with the idea of potentially moving away from mail checks for specific loans.
[00:21:20] Speaker C: Yeah. And the main reason is that, keep in mind, a check has to sit in the bank for four days before it can be deemed good funds.
[00:21:28] Speaker B: It could take four days to get to us.
[00:21:30] Speaker C: It could take four weeks to get to us. The mail is notoriously slow. Right. And so for that reason, we are looking at ways to streamline that.
[00:21:42] Speaker B: Again, thank you to all of our listeners out there today on deeds in the desert.
[00:21:47] Speaker A: Thanks for joining us this week on deeds in the desert, where short term investments meet long term investors. We hope you enjoyed the content so much that you share it with all your friends. Who doesn't like learning about passive fixed income, right? Still hungry for more education? Visit our
[email protected], or if you're ready to take the leap and start investing, give us a call at 702-7610 and schedule a free investor consultation.
Welcome listeners. Welcome, listeners. You're listening to the deeds in the desert, the place where real estate investors tune in for the latest news and available investments at Ignite funding. If you're on the hunt for a low effort passive income stream, then turn up that volume and pull out the hammock. As we get ready to feed you your weekly dose of real estate investing insights.
