Once your investment proposal reaches enough funding and all funds from members are received, Fractional will begin the offer and closing process. This process can be an exciting, yet stressful time. But don't worry - Fractional will be here every step of the way.
Fractional partners with lenders to offer short-term and long-term loans for properties under an LLC. Our exclusive partnerships allow groups to acquire LLC loans with no personal guarantor needed from any co-owner. Fractional does not require any co-owners to be a personal guarantor for the entire loan of the whole property. You will only be solely responsible for your part of the loan based on your share of the property.
This is a huge value-add since traditionally it is almost impossible to acquire commercial loans with no personal guarantor, and rates are often very high (6%+). Without Fractional, most commercial lenders will require a personal guarantor to assume all the debt even though they only own partial equity of the property.
If your group wishes to really optimize on interest rates, you can nominate a co-owner to use their personal credit to acquire a conventional mortgage such as an investment home loan or second home loan and close with your personal names on the title**.**
Our co-ownership legal agreement allows the debt-taker to be compensated and owners can choose to quitclaim the title to an LLC after closing at their own risk.
You are welcome to bring your own conventional lender or find a conventional lender through Fractional’s network.
Read below about the benefits of Fractional’s mortgage financing and other financing options