FIX-IT, SELL-IT, PROF-IT
AS A BANK
With our unique Equity IQ program, Value-builders helps banks sell bank-owned properties for more money, in less time, and with no additional risk. We complete an extensive valuation process to determine the current value of the home (reserve price), as well as the future value if certain improvements are made. These improvements can be as simple as general clean up, paint and carpet, up to re-model work, including new kitchens, baths, room additions, etc. Value-builders then completes, and pays, for all improvements. Once improvements are completed, Value-builders homes are staged with high quality furniture and artwork. Statistics prove staged homes sell twice as fast and for higher sales prices than vacant homes. When the property closes, we split the net profit with the bank between the initial valuation and the sales price (see example below).
Value-builders assumes 100% of the risk.
If the property sells for the reserve price or below, we make zero, and lose our remodel expense. Again, there is zero risk taken by the owner (details are in our contract).
Value-builders offers banks an alternative to losing money on bank-owned properties, lengthy listing periods, and poorly maintained houses. We partner with your real estate agent to help minimize losses, and in many cases break-even or better on your bank-owned properties.
Example of the Value-builders model:
Assume a bank-owned property is in poor condition, requiring new paint, carpet, and a new kitchen. The note on the property is currently $200,000, but in its current condition the home is worth only $180,000 at best, which becomes the reserve price. Value-builders determines it will cost $15,000 to do the work necessary to get an increased sales price. We determine the house will be worth $250,000 once the work is complete. The house goes under contract and sells for $240,000:
Sales price: $240,000
Minus: reserve price $180,000
Gross Profit $60,000
Minus: re-model expense (paid at closing) $15,000
Net profit: $45,000
Bank share (50%) $22,500
In this scenario, the bank effectively receives $202,500 for the property (reserve price + bank share).
Why do Banks choose Value-builders?
- Experience: We have over 30 years’ experience in real estate investing, including appraisals, 2500+ sales, and hundreds of remodels. We know what touches sell homes, and only spend on items that will generate the best possible return.
- Proven track record: While there is always risk in investing in real estate, we have profited on over 98% of our investments, even in bad years
- Shared risk: Because we pay for all remodel expenses, we have a huge financial risk in each re-model we do. If we are wrong, Value-builders™ loses money. Our interests are aligned with the Bank.
- Staging: We stage properties with high-quality furniture. Staged properties sell for 17% more and 2.5 times faster than non-staged (International Association of Home Staging Professionals and StagedHomes.com*)
- Costs: Because of our industry experience and contacts, we complete most remodels for about half the cost and in about half the time as someone without experience. Our sellers therefore often make the same or better return sharing the profit with Value-builders™ than doing it themselves.
*Based upon a survey conducted by The International Association of Home Staging Professionals® and StagedHomes.com® of over 1,000 homes (62% Vacant, 38% occupied) across the Continental US and Canada prepared for sale by Accredited Staging Professionals (ASP®) in today's market.