How do draws work on a Boomerang loan?

Draws are funds set aside from the total loan amount and released after work is completed. A request needs the amount, the list of completed scope items, 10 to 20 photos of the finished work including current pictures of bathrooms, kitchen, and shared spaces, and receipts. The loan must be current and carry hazard insurance, and flood insurance where applicable. Requests received before 2pm MST are processed the same day; later requests go out the next business day. Most borrowers take about three to five draws over the life of a loan, and the process requires no inspection beyond the photos.

What is a scope of work, and how does it affect draws?

A scope of work is an itemized list of the renovations planned for the property, submitted before the loan funds. With a cost breakdown for each item it becomes the budget, and it governs how much is disbursed as each item is finished. Where the draws budget is above $20,000, every line needs an estimated cost. A line that runs over budget may not be reimbursed in full; budgets can be renegotiated with the lender, or the loan modified to add draw funding.

Bridge lenders

Boomerang Capital Partners

Boomerang Capital Partners, LLC is a private real estate finance company in Mesa, Arizona, founded in 2006, focused on asset-backed lending to borrowers underserved by traditional banks. Its borrowers are experienced builders and flippers, and the homepage states it is currently funding loans in Arizona, Colorado, Texas, Utah, Oklahoma, and Tennessee.

The loan menu runs from cosmetic flips — paint, tile, fixtures, usually no permits — through intermediate flips and major flips that need more time, experience, and funding, to acquisition loans. It also writes short-term acquisition financing to bridge a long-term rental or short-term rental purchase until permanent financing lands. The firm says it can provide reliable, predictable financing in as few as 2 business days.

Loans fund against an itemized scope of work, with renovation money held back as draws released once work is finished. A draw request needs the amount, the list of completed scope items, 10 to 20 photos of completed work, and receipts, and the loan must be current with hazard insurance, plus flood insurance where applicable. Requests received before 2pm MST are processed the same day. Most borrowers take about three to five draws across a loan, and where the draws budget exceeds $20,000 every scope line needs an estimated cost.

The firm describes its team as bankers, investors, and former fix-and-flippers with more than 14 years in the industry, says most of its borrowers are repeat clients, and says it has funded thousands of homes and hundreds of millions of dollars. It publishes no rates, points, LTV limits, or minimum loan size, so those have to be quoted directly.

Best for

Experienced flippers and builders in Arizona, Colorado, Texas, Utah, Oklahoma, or Tennessee who need draw-funded renovation or acquisition capital fast. Not for first-time investors, and not a commercial or multifamily lender.

What they do

Cosmetic flip loans
Intermediate flip loans
Major flip and heavy rehab loans
Acquisition loans
Short-term bridge financing for rental purchases
Renovation draw administration

Details

Attribute	Value
Founded	2006

What stands out

Founded in 2006 in Mesa, Arizona, and currently funding loans in Arizona, Colorado, Texas, Utah, Oklahoma, and Tennessee.
Says it can provide reliable, predictable financing in as few as 2 business days, and that most of its borrowers are repeat clients.
Draw requests submitted before 2pm MST are processed the same day; later requests go out the next business day.
Says its team has more than 14 years in the industry and has funded thousands of homes and hundreds of millions of dollars.

Common questions

How do draws work on a Boomerang loan?: Draws are funds set aside from the total loan amount and released after work is completed. A request needs the amount, the list of completed scope items, 10 to 20 photos of the finished work including current pictures of bathrooms, kitchen, and shared spaces, and receipts. The loan must be current and carry hazard insurance, and flood insurance where applicable. Requests received before 2pm MST are processed the same day; later requests go out the next business day. Most borrowers take about three to five draws over the life of a loan, and the process requires no inspection beyond the photos.
What is a scope of work, and how does it affect draws?: A scope of work is an itemized list of the renovations planned for the property, submitted before the loan funds. With a cost breakdown for each item it becomes the budget, and it governs how much is disbursed as each item is finished. Where the draws budget is above $20,000, every line needs an estimated cost. A line that runs over budget may not be reimbursed in full; budgets can be renegotiated with the lender, or the loan modified to add draw funding.