Our 'Capital Call' Event
About six months ago my wife and I received a FedEx letter. It was from the management company responsible for the TIC (Tenant In Common) we invested in about 5 years ago. The amount we invested was small compared to others: $300,000 but it was huge for us.
The package contained a letter demanding we provide $55,000 within 30 days to the management company. They had been seeking a refinance of the short-term construction loan and were having a hard time to nail it down. After much gnashing of teeth due in large part to the bad economy, we borrowed and sent the $55k in. The company intended to refinance with HUD for a permanent loan, and HUD would only refinance a smaller amount than the current construction loan balance. We all had to make up the difference.
Lucky for us, the permanent HUD loan was secured for a 35 year term, at a more favorable interest rate than was forecast. We just received a 'refund' of the 'Capital Call' monies in the amount of $35,000! We dodged a financial bullet this time. But, what about the many others out there who may have lost their life savings?
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