You have questions, we have answers.
Here is a list of the most Frequently Asked Questions. If you still have questions we didn't answer, call us
and we'll try to answer any questions you have.
I really want to get started, who can use PennyONE?
AnyONE can use PennyONE! Thats what makes our program different than all the other programs out
there. Truly AnyONE can use PennyONE to unlock their value today!
What paperwork is required for PennyONE's approval?
We need the completed Private Contribution Application available Here. Once submitted, we need the
Escrow Instruction Letter, buyers loan approval and both the buyer’s and seller’s agreements. There is a
chance we'll ask for other documents, which will depend on the needs of the transaction.
I need to close pretty quickly, how long does it take to get the funds?
As long as we have all of the required documents (approval, application, and signed contracts) we can
usually fund that same day.
How long can we use PennyONE's funds for?
Although we can make special exceptions, we expect transactions to close within 5 days.
How much do we have to disclose?
We require that all transactions we're involved in be disclosed to all related parties.
Isn't this just a side agreement between the buyer and the seller?
No, PennyONE's agreements with the buyer and the seller are completely separate. These agreements
are not linked together and do not represent an agreement between the parties. No part of the fees we
collect from the seller are ever used to assist their buyer.
How do I explain your services to the lender?
Openly and with full disclosure. We are a marketing and consulting firm that works with the seller by
marketing their property to the widest possible pool of buyers and thus enabling them to sell the property
more quickly. We are not real estate agents, nor do we replace them.
Is PennyONE a down payment assistance company?
No. Down payment assistance companies have traditionally been non-profit companies that provide gift
funds or grants. Because we are a for profit company that profits from the sellers we help, we cannot be
used with FHA loans that may be used by the non-profit companies. If you have an FHA loan or are using
a lender that is not compatible with our company, we would be happy to refer you to a down payment
assistance company.
Does the buyer owe you anything after the closing?
No. Our transaction is finished at the closing of escrow. As long as everything closes and we get our fee,
then the buyer owes us nothing...except of course for the application fee. (1 Penny)
What happens if the deal doesn't go through?
If the deal does not go through, then all the funds that PennyONE provided must be immediately returned,
everyone is released from there obligations, and nobody is charged for anything.
What types of lender programs will the PennyONE program work with?
Any lender that has a non-seasoned loan program could potentially work with our program. However,
every lender has different underwriting guidelines. Therefore, it's important to talk to your underwriter
regarding the use of our funds in order to determine how the transaction will be constructed.
Is the PennyONE marketing fee high?
No. PennyONE helps bring a transaction together that wouldn't have happened without us and we take a
proactive role in every transaction. We are proud of the value we add and our fees are structured
according to the needs of the transaction.
How is PennyONE paid?
We are paid our fee from the sellers proceeds at closing.
Can PennyONE be used with A paper loans?
Yes. However, we only work within each lenders guidelines and the majority of A paper lenders require
seasoned funds to be used. There are a few exceptions (for example: when a buyer has money in a
401-k that they don't want to touch) It's best to check with your lender and see whether or not they allow
this type of program. Additionally, we insist on full disclosure and compliance with each lenders
underwriting guidelines.
Will your program work with non-conforming loans?
Yes, if the lender allows non-seasoned/sourced money, but you should check with each lender on their
policy. We would be happy to refer you to lenders we have successfully worked with in the past.
Is this considered a side payment?
No, PennyONE is a marketing services company that enhances the sellers ability to attract a greater
number of qualified buyers. No part of the sellers fee is ever used to assist the buyer.
This sounds too good to be true, is PennyONE's program legal?
Yes. We are in full compliance with the guidelines of the Real Estate Settlement Procedures Act (RESPA),
the United States Department of Housing and Urban Development (HUD), the Equal Credit Opportunity
Act (ECOA), and other federal regulatory authorities as well as the generally accepted industry standards.
What is the maximum amount PennyONE will contribute to someone?
We can do up to $100,000 for each residential transaction. Our only real limit is the amount of equity in the
property or the amount of fees the seller is willing to pay. Also, keep in mind there may be additional
requirements for amounts over $40,000 and our fees are 15% for everything above $40,000.
Will you put a lien on the property?
No. We are in and out of the transaction when at the closing of escrow, so we are out of the deal before a
lien would be necessary.
Does the appraisal have to be inflated for this to work?
Absolutely Not. There must be legitimate equity that the seller is willing to walk away from for PennyONE's
program to work....period. A seller may sell for market value, but this value must be confirmed by an
independent URAR Appraiser to ensure the home is priced correctly. This independent appraiser must
be able to substantiate the value to the lender. If legitimate value is not there, our program cannot be used.
Isn't PennyONE taking a lot of risk?
Yes. We are in a very vulnerable position and have only our buyer agreement which is a signature type
obligation. Our recourse is to take the agreement to court where we would be awarded a judgement.
This is why we only do business with people we find to be honest, trustworthy and verifiable.
Everyone wins with
PennyONE. I was
skeptical at first...how
could this be so easy?
Well, with PennyONE, it
was.
Brandon P., Gulf Coast
Mortgage of Houston
Frequently Asked Questions
