The MyBrix platform, particularly for Equity Funding and Release Funding options plays a critical role in securing funding for new or existing properties. By offering Brix at a discounted price, property owners make there property more attractive to investors making it easier for them to secure the funding they require.

How Brix Discounting Works in Equity Funding

In Equity Funding, property owners refinance or release equity in their existing property by selling Brix to investors at a price below market value. This discount makes up for the lack of traditional loan interest and offers investors an enticing opportunity to buy into property at below market value making it more likely for your property to get funded. The discount is up to 20% of the current market value of the property. This means that when property owners receive funds through MyBrix, they sell more Brix than they would at full value, which reduces the owner’s share in future sales or rental proceeds of the property.

The discount rate is influenced by several factors, including:

• Funding success: The more the discount the more likely a property is to be funded. If your property is not funding in the first round you may need to increase your discount to make it more attractive to investors.
• Property Type: Whether the property is owner-occupied, or a rental also impacts the discount rate.

Brix Discounting in Release Funding

Release Funding functions similarly to Equity Funding but is geared toward homeowners who wish to access their property’s equity without taking on debt, providing an alternative to traditional reverse mortgages. The homeowner can continue to live in the home while selling discounted Brix to investors.

Investors buy the Brix at a discounted rate, with the expectation that the property’s value will increase over time. The owner retains the right to live in the property without the obligation of making interest or loan repayments. The trade-off for the property owner is a lower share in the final sale proceeds of the property, but the benefit lies in immediate access to capital.

Just like in Equity Funding, the discount rate in Release Funding is up to 20%, depending on the homeowner’s existing equity and the property’s valuation.

How Brix Discounting Works in Index Funding

In Index Funding, future property owners raise capital by selling Brix to investors at a fixed price, which is indexed to increase over time. Unlike Equity Funding, the emphasis in Index Funding is not on discounting but rather on the structured growth of Brix value through annual indexing. The price of Brix grows steadily, ensuring both flexibility for the property owner and predictable returns for the investor. As a result, brix are not discounted in Index, Social or Developer funding.

Using the MyBrix Calculator to Understand Discounts

Property owners can use the MyBrix calculator to estimate the discounts that will be applied to their property’s Brix when listed on the platform. The calculator helps owners understand how much equity they will lose because of the discount, and how much capital they can expect to raise. It’s an essential tool for anyone considering Equity Funding or Release Funding as it allows them to plan by seeing how much equity will remain in the property after the Brix are sold.