This episode documents the highest outbound capital week in company history, with over $1 million wired across a $500K same-day transactional funding deal and a $410K minor subdivision acquisition. The breakdown reveals how miscommunication on closing timelines created unexpected cash crunches, how multiple lines of credit (personal Wealthfront at 5%+, Chase brokerage at 7.5%) provided same-day liquidity, and why maintaining 100% funding reliability requires Plan A/B/C backup structures.
Key Takeaways:
- Lines of Credit Enable Same-Day $500K+ Coverage Personal Wealthfront accounts (5%+ rates) and Chase managed brokerage accounts (7.5% rates, 50% of holdings) provide instant liquidity without debt-to-income underwriting when traditional HELOCs fail.
- Transactional Funding Timelines Require Document-Level Clarity Assuming “Tuesday closing” means same-day funding instead of just document signing can create unexpected 48-hour cash gaps on half-million-dollar deals.
- Reputation Requires Zero Funding Failures, Ever Maintaining 100% deal closure rates through multiple backup credit lines differentiates professional capital providers from competitors who routinely drop deals due to liquidity constraints.
Tune in for the complete playbook on structuring emergency liquidity access and avoiding cash crunch scenarios that destroy funder credibility.
(Podcast transcript below)
Hi, Chris Duff over at Serious Land Capital, Vacant Land Funding Partner. So today, just wanted to go over a couple options in regard to utilizing lines of credit. This was a major factor as we were closing on some much larger deals.
this week in mid to high six figures as far as wires out of our account. That was the most capital outbound week that we’ve ever had in our business here. it was trying to avoid a cash crunch scenario. And really the key is that one of the deals was the same day
half a million dollar transactional funding deal. I know I had remarked on that before. you know, ultimately I have to take the responsibility for it. We thought that it was an agreed upon closing as of Tuesday of this week. And that would be, you know, the final date that funding would also happen on that day. So we thought, okay, hey, we can…
you know, send in or wire in 500 K, you know, the day before get it back that following day, all the closing dogs will be squared away. So we’re, set from that side. Uh, and then we have lined up another extremely time sensitive deal for, uh, about 410,000 out for this, um, uh, minor subdivision deal that I talked about before. was a.
Very urgent came to us last week. Normally we wouldn’t move on a deal at large, but it was maybe the best deal that we’ve ever seen. So, and the seller, you know, it’s just extremely motivated and had time pressure on us and that there was a real flight risk for that. So we tried and he was supposed to close end of last week, but we were able to get it into this week to allow for title documentation to.
be updated to add RLC and closing docs to be updated, but because we thought that the transactional deal was going to happen on Tuesday, that we could schedule the 400k deal on Wednesday. So then we wouldn’t have a cash crunch that was going to happen. Though I only found out last week, last Thursday,
that the transactional deal was technically closing on Tuesday, but that was just for the documentation, the actual signing on both the A to B and the B to C side, and also as the middleman in the transaction. But the actual funding was going to happen today, this Thursday, January 30th. So then that left us in a crunch of, now we need to…
close on this 400K deal that’s actually going to take us below the total liquidity that we had available for the transactional deal because we were already expecting to utilize some of those funds that we were getting back. Now, it wasn’t that large of a gap and I was already thinking, okay, plan B in case
there is an issue like, are we able to get extra capital involved here? Just because sometimes things just don’t pose on time. You always want to have backup plans. But nevertheless, it was still a bit of a surprise and not the way that I would have scheduled it had I asked a few more questions. So I had to scramble a bit. And this is where line of credits really come into play. So instead of having to liquidate various holdings, incurring…
you know, various taxes and so forth or longer periods of time in order to cash into our business account. Had a line of credit. Well, a couple of them actually between or myself, I have two strong ones that I can pull from and then my partners also have an additional business line of credit. So we have good coverage.
that we could probably spin up north of a half a million dollars LOC within a business day if we really needed it. So it gives us cushion to move fast in these types of situations. And the ones that I had available, one is a little bit smaller, just over 100K. That can be a draw from my personal Wealthfront account. And then,
also have additional holdings in a, extremely liquid, chase managed brokerage account that allows for a, roughly 50 % draw on, on any of the capital within that. that interest rates a little bit higher. That one’s closer to maybe seven and a half percent.
A total, the wealth front one is closer to five or just over five points. but the chase one’s a little bit faster to work with since we operate, know, chase business accounts. it’s near instantaneous. but I’d only found out that I didn’t have the document signed to activate that line of credit end of last week. was scrambling with my personal banker. Okay. Can I get this ready to go?
before I’m going to need it by, know, yesterday, mid, mid this current week. And ultimately we were able to sort it out. there was actually a hassle yesterday when I had to get it, the line of credit had been working on my side. And then the actual day that I needed it, the whole tech system broke down. And so chase had to handle it manually. took a whole nother business day. So was just trying to buy more time with the seller.
and, and title company ended up not being a concern there, but yeah, it’s still, still a stressful moment when you’re trying to get to avoid a cash crunch, even if you only need to cover yourself for four or five business hours total. but that just gives you an example of how we’re able to, you know, when, people come to us and say, yeah, can I get deals funded and everything? Like we have a hundred percent hit rate. There’s.
That’s the main thing that we fall back on is that we know there’s so many other funders out there in the land game that either drop out of a deal or they thought something was enclosed, they don’t have the liquidity, or we get people reaching out to us saying, oh, my funder just dropped, can’t handle this. Plus we have more capital available than effectively any other funder within the industry. so that’s a real point of…
towards our reputation is that, if we’re going to do this deal, then we will have the capital available for it. So that’s why I like to have a plan A, a plan B, a plan C, just in case things fall apart so that I never need to go back to our client and say, hey, we need to wait longer here. We’re just not going to have it ready this day. It’s just never a good look. Of course, I tried to arrange inflows and outflows like I discussed earlier.
Um, so that, uh, it is more strategic and the cost of capital is less. You’re being more efficient. Um, you know, but sometimes things happen and you need to cover those gaps, even if it is just for a spare few hours. Um, so ultimately was able to do that and, uh, cover that gap there. Um, and, and, uh, you know, then can just pay back that line of credit immediately since, you know, we were.
already getting the transactional funds back into our account today. So, you know, there’s really no, no debt coverage, you know, might cost us like 15 bucks for a day to draw out over a hundred grand, rapidly. So that’s just something to keep in mind. And, you know, I know everybody has different bank relationships and so forth. And we’ve used Chase for years, obviously they’re, they’re a monster within the field.
but we found their customer service to be quite solid and gives us a lot of optionality to work with. Not as much optionality as probably regional banks do, but a lot. Like this line of credit that I have within Chase, like it’s not a HELOC, it’s just purely based on a managed brokerage account and no debt to income research is needed to be done. They don’t need to underwrite.
you know, me as a borrower at all, just because we’ve had an established relationship within Chase. And so long as you have a 300,000 minimum set aside within this managed brokerage account, they’ll just auto-approve you a preview for a 50 % line of credit on that account. So that is obviously extremely handy to have, especially as entrepreneurs.
Yeah, debt to income ratio is not always ideal. We don’t, you know, we don’t pay ourselves routinely here. So, you know, where I might get denied on a HELOC, which has happened in the past, this served as an additional leverage point that provided, you know, as much, if not even more liquidity available than if I had set up a HELOC anyway. So just to give you ideas for
how you can create more liquidity than you might think you have available to you. Of course, you got it. You got to make sure that you’re not over-levering yourself. Like I prefer lines of credit for short turnaround times when I know more capital’s coming back. I don’t like holding debt that long most of the time. Even if we can out earn it on an annualized
basis just cause again, this is a fairly risky business. You can, you can easily run into trouble if you’re just. Levering up, levering up all the time. So that’s how we try to handle line of credits more for cash crunches at the moment may, adjust that line of thinking going forward, but just wanted to share what we were going through, on this side and how we handled, you know, over a million dollars or.
roughly about that went out of our account within span of a couple of days and largest outbound wire transfers that we have ever done in our business in such a short period of time. With that, if you’re looking for any funding, check out seriousland.capital, any land daily diligence deals that’s on Facebook, so zero cost to review any deals, and then landpricer.ai.
for the most accurate and simple way to review and price land deals. Just talked to my engineering team earlier today. We are, or they’re gonna be done on their side by end of this week. So I just have some additional auditing work to do over this coming week. And then we will be good to test and launch with that. Take care everybody.
