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Frequently Asked Questions

What is AlphaFlow?

AlphaFlow is a tech-enabled investment manager that buys real estate loans from lenders across the nation.

What is AlphaFlow’s value proposition?

AlphaFlow is a collaborative and reliable partner that provides capital, software and underwriting insights to help its lenders grow their business.

What makes you different from your competitors?

Speed – AlphaFlow provides instant feedback (<24 hours) and buy in less than 5 days Transparency – AlphaFlow shares underwriting insights via its Lender Portal
Reliability – AlphaFlow reviews loans daily and buys 2x per week

How long have you been in business for?

AlphaFlow has been an investment manager for 4 years and began its institutional whole loan buying program in January of 2019.

Do you originate loans at AlphaFlow?

Unlike others in the industry, AlphaFlow does not originate loans. AlphaFlow solely purchase loans from lenders.

How long does the loan purchasing process take?

AlphaFlow provides instant feedback via our proprietary Loan Sizer, feedback within 24 hours from our investment team and can close a purchase within 5 days.

What size loans does AlphaFlow buy?

AlphaFlow buys loans ranging in size from $75k-$2MM. Loans outside of these ranges may be considered on an exception basis.

What types of loans does AlphaFlow buy?

AlphaFlow buys short term, business purpose, first-lien loans on residential real estate. This includes Value add, Refinance, Stabilized/Rent.

What types of properties does AlphaFlow buy loans for?

AlphaFlow buys loans on Single Family Residential (SFR 1-4 unit), Condo, Multi-family (5-9 units). AlphaFlow does not buy loans commercial property types (office, storage, Industrial, etc).

How many lenders do you partner with?

AlphaFlow does not disclose this, but AlphaFlow is expanding lender partnerships each month. We expect to have 100+ in the next 12 months and AlphaFlow currently buy loans in 40+ States.

Does AlphaFlow table fund loans for lenders?

AlphaFlow currently does table fund loans, in select states. Given how important table funding is to the growth of our partners, AlphaFlow is working to put a program in place that will allow it to table fund loans in almost every state.

What rate does AlphaFlow currently pay for loans?

AlphaFlow buys loans starting at 6.99%+ with volume commitments. AlphaFlow prices range from 6.99% to 9.99%+ depending on the characteristics of the loan.

Are AlphaFlow’s buy rates the lowest in the market?

No. AlphaFlow believes you get what you pay for. AlphaFlow is committed to delivering a high level of service and value to our lenders. AlphaFlow has observed that other institutional loan buyers with lower rates are slower to buy, have more complex loan sale processes, and burden lenders with unnecessary costs. In addition, they delegate the investment decisioning and post-closing servicing to non-accountable third parties – putting the lender/borrower relationships at risk.

How does the pricing work with AlphaFlow?

AlphaFlow uses an algorithmic pricing model that takes into account transaction, borrower, property and local market related factors when determining the interest rate at which AlphaFlow will purchase a loan. Any difference between our purchase rate and the interest rate of the loan will be sent back to the lender when the borrower makes their monthly payment (known as a Yield Strip).

Does AlphaFlow require a portion of origination fees?

No, AlphaFlow’s lenders keep 100% of the origination fees.

Who is providing AlphaFlow’s capital?

AlphaFlow has three main groups of investors: 1) accredited investors 2) institutional capital 3) family offices. When AlphaFlow buys loans it acts as master servicer and continues to act as a single point of contact with its Lenders.

How much volume can you put to work?

AlphaFlow is backed by multiple types of investors and has committed capital of $1+ billion which it expects to deploy in the next 12-24 months.

How many loans are you buying on a monthly basis?

~$25-$50+ million per month, which is expected to scale in the coming months.

Does AlphaFlow have a maximum term?

AlphaFlow will purchase loans with an initial term of no more than 24 months and the loan can have up to two six-month extensions.

What is the minimum credit score on a loan AlphaFlow will purchase?

The minimum credit score for a borrower/guarantor is 600.

Are there any state restrictions?

AlphaFlow will review and buy loans in all 50 states.

What are the maximum leverage ratios for the loans?

AlphaFlow will purchase loans with up to 85% of as-is LTV, up to 90% of LTC and up to 75% of ARV. Refinance, stabilized/rent and ground up transactions are subject to slightly lower leverage ratios.

What is the servicing process for loans after purchase?

AlphaFlow understands how much value borrower relationships have to its lenders. While AlphaFlow does purchase loans with servicing released, AlphaFlow still wants its lenders being ‘the face’ of the loan to the borrower to maintain those relationships. As such, AlphaFlow allows the lender to be the single point of contact for items like rehab draws post sale. In addition, AlphaFlow engages sub-servicers to hold reserves and collect interest payments and payoffs. AlphaFlow acts as the single-point of contact with its lenders for our sub-servicers.

How long does it take for you to process a rehab draw?

AlphaFlow aims to process a construction draw in 24-48 hours after the request is submitted to AlphaFlow’s servicing team.

What servicing companies do you have as sub-servers on the loan?

AlphaFlow works with several servicing groups including Cohen Financial, FCI and BSI. AlphaFlow will continue to evaluate additional servicings groups as needed.

Does AlphaFlow work with brokers?

AlphaFlow does work with brokers, but requires each originating lender to have a direct purchase agreement with AlphaFlow. AlphaFlow will pay brokers on a sliding scale based on volume and yield.

Do you take foreign nationals as borrowers?

AlphaFlow has the ability to buy loans from any partners who have borrowers with active business licenses, a US operating entity and the borrower must have a credit score.

How does a lender sign up for AlphaFlow’s loan buying program?

Fill out our ‘Get Started’ Form, and someone from our team will reach out to discuss the process with you further!

Does AlphaFlow require appraisals?

No, AlphaFlow doesn’t need an appraisal but does require its lenders to provide a third-party valuation, such as a BPO.

Will AlphaFlow buy seasoned loans?

Yes, AlphaFlow will buy seasoned loans, but the loan must have at least 3 months until maturity and be performing.

Does AlphaFlow buy loans with a lender participation agreement?

Yes, AlphaFlow will buy loans with a lender participation agreement. The lenders’ participation will be subordinated.

Will AlphaFlow buy non-performing loans?

AlphaFlow currently does not purchase non-performing loans. However as AlphaFlow continues to expand its investment strategies, AlphaFlow expects this to be one of its future strategies.

Will AlphaFlow buy loans in Judicial states?

Yes, AlphaFlow buys loans in all 50 States.

How much track record do I need before I can sell loans to AlphaFlow?

AlphaFlow traditionally like to see at least one year of track record from its partners but can be flexible to help new and growing lenders.

Will AlphaFlow do blanket loans?

Yes, Alphaflow will buy portfolio or blanket loans.

What is the process to become an approved lender?

AlphaFlow has a simple three-step process to become an approved lender (Qualification, Diligence and Onboarding), the specific steps for each are further detailed in its institutional loan buying guide.

If you have any questions, please don’t hesitate to reach out to our team at lenders@alphaflow.com

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