Sucheta
The SRAP "manual" on the MDA website gives 4 categories for which money can be applied for, one of which is rental of newly built properties which is what we are concerned about, others involve repair and rebuilding of pre-existing properties which were damaged by the hurricanes. So in our case, the money is to suppliment us for charging lower rents than may possibly be acheived in the open market.
The rent is not guaranteed, but there is such a shortage of property to rent in the area that I believe voids are unlikely and they would have to amass net lost rent of $40,000 over 5 years before we would be out of pocket. In addition, the rents that can be charged in the scheme have been increased recently (and will be annually) so the properties will produce cash on a monthly basis.
You agree to enter the programme for 5 years after which the $73,000 loan is forgiven. If you withdraw before the end of 3 years then all the money has to be paid back, this then reduces to 2/3 after 3 years and 1/3 after 4 years. I understand that some investors are not applying for the SRAP funding and choosing to take the higher rents on the open market. We are applying for the funding and will then use it to buy further properties in other areas of the Go Zone to rent out on the open market.
You are correct, as far as I understand it, that there is a separate completion bonus of $18k for completion within 6 months. I have been told that we will get the money in 2 cheques of $55k and $18k, both of which will be due on completion in 6 months.
The developer we are buying from does comply with the SRAP requirements. They have only been selling these properties in Europe since February this year, therefore the only person I know who has received SRAP money is Danny Silver from Property Direct Group, who are the selling agents for Europe, who invested and applied in time for Round 1 of the funding which closed towards the end of 2007.
I have attached below a copy of their recent newsmail which (although bragging a bit) gives you some idea of their progress with the project.
I hope this helps.
Kind regards
Paul
Welcome to our July/August Newsletter.
The Go Zone is coming along nicely!. Lot's of extra new jobs have opened in the area and the Casino's are growing daily, with Trump rumoured to be taking over and doubling the size of the casino just 3 miles from Bayside park and also opening a very large timeshare resort there. Wonder where their staff will live? - 3 guesses! But the new housing build is still slower than anyone would like due to the terrible "credit crunch" - EXCEPT for our group!
Sales are moving very nicely in the US and from my side - well! - since launching the Go Zone outside of the USA in late February 2008, it has been extra-ordinary. Nearly 200 "savvy" non-US investors have joined us and more are joining daily; and not just from the British Isles and the EU, but also from the Middle & Far East and lots from Australia and New Zealand!
What is more amazing with the non-US markets is that we have not spent 1 cent on media with the exception of our excellent PR company; whose job, (while certainly not taking anything away from them), was made easier by all the major media "grabbin" the story of the Go Zone. I have lost count of the top investigating reporters that members of "The Team" and myself have spoken to and been interviewed by who did not believe; until they done their own very thorough "due diligence", (naturally covering their own backs!), and duly gave us excellent coverage. Thanks to them all! (and AB Property Marketing for being so professional!).
The reasons for our extra-ordinary success are simple :
1 : We are the only builders in the Go Zone doing Steel Frame & Eco Friendly houses - which gives us top marks with FEMA & HUD
2 : Our great "Team" in US giving their usual 100% expertise and our equally great "Team" in Europe doing the same and looking after our investors from "cradle to grave" which we have been doing for zonk years!
3 : We are presently the ONLY group able to offer investors 90% totally non-qualifying loans at excellent rates! Why? At a meeting in London a prominant banker/financier remarked to me and my audience, (to paraphrase), "at this time of the worst "credit crunch" in decades; the bank offering this to the clients of Global/PDA must have done extremely strong due diligence and apart from finding the whole Go Zone credible, being a Government program, found that Global and the group to have a first class product, correct value and a first-class reputation and decided not to miss out themselves!" Naturally I agree! And I only gave him a coffee and a biscuit!
4 : We are the only group to offer a money back guarantee if you fail SRAP - yet still lots of people are saying to us - "this is too good to be true".
TO REPEAT!! - the offer is from the U.S Government and has absolutely nothing to do with the builder; or management, or agents or even the "man in the moon"! It is given by the U.S GOVERNMENT - No-One Else!!!
Some things are still slow; but are improving. The MDA was slow on the SRAP 1 phase as some places were built before SRAP came in and not to standard and the MDA office received nearly 20.000 requests from people who had not even "identified" a place yet - let alone put a deposit down. Anyway - that has now been corrected.
On our current Phase 2 the MDA is acting much stricter and not taking calls, or applications until investors have "closed" on land and have "promise to construct" from a builder. Also instead of applications "coming in willy-nilly"; the builders are being given specific monthly dates to hand in their investor's application - so everything in now much smoother.
Saying that - please study everything carefully!! Over 60% of US and 15% of non-US investors are not taking SRAP, as rents are so high, and continually increasing, that over 5 years instead of making $73.000 you would at present rate make well over $110.000!! THINK! - and study.
We will not be holding European seminars until September due to the vacation period - HOWEVER we are all working and available to answer all your calls and questions 7/7 as per normal!
We thank all the "savvy" non-US investors who have made our first few months so succesful and a pleasure and look forward to many more "savvy" investors joining us in the coming months - before more price increases and/or the SRAP programs start "winding down".
Please take the time to visit our updated website
From Leslie & the Mississippi team; Jeff, Ellen & the US National HQ team and my European HQ team, (oh and not forgetting Robert Shemin and his excellent team!) :
We Wish You Happy & Prosperous Investing!
Warmest regards,
Danny Silver
Property "Direct" America
(a div. of the Property "Direct" Group)
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