Lending Through A Build Wallet

Lending through a Build Wallet article screenshot

“Lending Through a Build Wallet” was the article produced and distributed at the PITBULL Annual Conference in Austin, TX.

Jake Harris
Oct 17, 2021

Trust may be the biggest production bottleneck for Private Lending Businesses.

Private Lending is built on Trust. Trust that the Borrower will do what they say they will do. Trust that the Contractors and Subcontractors that Borrower hires, will do what they say – and for the price they’ve said… However, Trust is in short supply these days. On top of that, industry-wide disruption is causing once rock-solid Borrowers to become unstable. Contractors are fighting an ever-uphill battle around Labor issues and Material shortages. Subcontractors are having to fight to staff a trained labor force in the field to satisfy their contracted obligations. One of these complications would stress an otherwise reliable Borrower, but multiple complications simultaneous may be beyond what most Borrowers can handle.

What happens when you don’t have the time necessary to build Trust with a potential Borrower through successful repeat projects? How does anyone satisfy the ever-growing lending demand our companies are facing without historical project-based trust in reliable Borrowers? How does any Lender gain some kind of project performance insurance against outside influences – like what is happen- ing in the market today?
What changed?

In late 2019, the US Office of the Comptroller changed US Banking Regulations to allow Banks to “tokenize” funds held on deposit. This regulatory change allowed FinTech Firms to create industry specific platforms that could program financial transactions where before human input was required. These industry specific platforms would require everyone to be vetted so they can receive a digital wallet from which they can pay for/receive payment for material/services via a simple contract / execution / approval process.

What is a Build Wallet?
A build wallet is a dedicated digital account for the direct receipt/distribution of project funds.

Why should I Lend through a Build Wallet?
Simple – Trust through Technology.
Trust that everyone involved in the project is using project funds only as budgeted and approved for that project. Funds are now ded- icated to a specific addressed project with every dollar accountable in real-time 24/7 access. A single project management platform affords confidence that everyone is “on the same page” – from Lender to Laborer, and all are actively moving the project forward!

How does a Build Wallet help my Borrowers?
A build wallet platform gives Borrowers the one thing that can separate the winners from the losers. Those who profit and return, from those who run away screaming from real estate. A platform based on build wallets provides all Users with unbreakable Financial Discipline.

Traditional Lending:
Pro
• Historical Performance
• Based on 3rd Party Inspectors w/photos

Con
• Lack of standard Process/Procedure • Highly Labor Intensive
• Based on Subjective % Complete
• Risk of Human Error
• Risk of Misappropriations of Funds
• Risk of Comingling of Funds
• Property Lien Risks
• Wire Transfers are expensive in both time
and cost

a Build Wallet Platform:
Pro
• Single Platform for all project labor/material funding
• Dedicated funds – 1 Project = 1 Wallet • Total Visibility and Control 24/7
• Track Flow of Funds, not % Complete • Greatly Reduced Human
Input/Error/Overhead
• Funds Transfer – Instant & Free • Provides Unbreakable Financial
Discipline for all Users

Con
• New Platform requires Team training • More Rigid Fund Distribution requires
greater initial planning