The Maker further agrees that in the event any payment is made, such being at the option of Maker, only payments in even dollar amounts greater than twenty four dollars shall be made with amounts paid being first applied to accrued interest and then to principal.

If the property is in reasonable shape then the cost of FC is mitigated and the holding costs will be for preservation service, accrued property tax, sales costs on liquidation and if needed, any repairs to make it financeable to an owner occupant.

Interest accrues or is charged as funds are disbursed. 

Matt R.The numbers will be different per location, but if an investor doesn't accrue for these expenditures, then they won't have a clear and accurate picture of how the investment is really performing.

Below is how some landlords deal with this and I can't speak to the legality of it.The best solution to this is to add a clause in your lease in every place where an additional fee accrues to you, that expressly states that the tenant agrees that the additional fees are rent due to you.

It's like a non-interest bearing escrow account with accruing charges and fees.

Most at 0% interest for anywhere from 6-18 months so if you're looking at a quick turnaround time you can pay them down before the interest even starts to accrue, and the accounts don't impact your personal credit.

I plan on cash out refinancing after the rehab is done and paying them back along with the interest accrued throughout that period.Market value: $100k Purchase price: $75kRenovations: $30k House doesn't need many repairs, but this is the estimated cost of finishing the basement and adding a bedroom and bathroom.After repair value: $150kCurrent rents per month: $1100Income Source: W2 employeeFICO: Good

Cash flows from individual property sales (or, at the Fund's option, on refinancings) are to first go towards payment of the current preferred return, then accrued preferred return, and any remaining proceeds are to go towards return of the Company's capital contribution.Personal Guaranty: The principals of the Sponsor are to provide a personal guaranty on the principal amount (not including targeted returns) of the investment.

(Once you filed for the TDA, you will earn the 18% (1.5%/month) on the ENTIRE amount including any interest that accrued before you filed the TDA.You can bid at the tax deed auction but my understanding is that you have no advantage at the auction over anyone else who attends the auction and bids.