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Wadot Capital Reviews (2)

As far as I can understand from his complaint and my email correspondence with him Mr [redacted] is making 4complaints related to WADOT Capital, 1.) That WADOT switched his loan approval to a "Construction Loan" days prior to closing 2.) That WADOT is unreasonably withholding construction draws3.) That WADOT is benefiting from the withholding of construction draws by charging "double interest" and 4.) Related to #3, that WADOT has used the funds held for Mr [redacted] loan for another loan I have attached the following documents to support WADOT's position on Mr [redacted] complaints which I will outline below: 1.) [redacted] CLA: This is the Conditional Loan Approval generated on 4/15/ 2.) Draw Request 6-29-15: This is the original budget submitted by Mr [redacted] for the initial underwriting of the loan, the hand written notes were added by Mr [redacted] as part of his 6/29/draw request 3.) Holdback Spreadsheet: This is an internal WADOT document representing project progress and disbursements 4.) Trust Account: This is the Trust Account Ledger maintained for the [redacted] Construction Holdback Account 5.) Insurance: This is the Insurance Binder supplied by Mr [redacted] to satisfy WADOT's funding requirement that the property be insured 6.) Construction Holdback: This is the Construction Holdback agreement that governs the disbursement of construction funds 7.) [redacted] Land Use complaint 8.) Phase II Electrical estimateThis is in addition to the initial roughly $12,estimate to bring the electrical up to general usabilityIt is my opinion that this additional cost is related to conversion of the building to a cannabis grow operation, which was not the approved purpose of the loan Response to Complaints 1.) Complaint that WADOT switched the loan to a Construction loan days prior to closing, this is not trueWADOT received Mr [redacted] loan submission from a broker on 4/13/and initially issued a conditional loan approval on 4/14/in the amount of $192,containing a requirement that $75,be held as a construction holdback based upon the budget provided for $75,in repairs and upgradesThis approval was updated on 4/15/to increase the loan amount to $195,000.00, this updated Conditional Loan Approval was executed and issued by WADOT on 4/15/and was executed by Mr [redacted] and Mr [redacted] on 4/28/In underwriting this loan WADOT valued the property taking into consideration the repairs and upgrades Mr [redacted] represented would be made, at no time did WADOT approve a loan without a construction holdback to ensure that the stated improvements would be made 2.) Complaint that WADOT has unreasonably withheld draw funds: This is not the case, and there are several problems related to this A.) Construction progress: I have attached Mr [redacted] budget for the repairs and both are inspection spread sheet and Trust LedgerI spoke to Mr [redacted] prior to the closing of the loan to run through the draw process, during that conversation Mr [redacted] outlined his experience with rehab projects and was concerned that the WADOT Construction Holdback would slow him down, as a resolution to his concern it was agreed that the $20,"Phase 1" disbursement would be made quickly after closingThis disbursement was made with the understanding that no further disbursements would be made until the line items in Phase were completedOn 6/29/Mr [redacted] submitted the attached draw request, which he significantly modified from the original budget, and on top of that our inspection in connection with the 6/draw request found that A.) Mr [redacted] was/is operating a Cannabis Grow operation on the property (Which WADOT had no knowledge of)and B.) a significant number of the line items from Phase had not yet been completed In discussing the Phase items which had not been completed Mr [redacted] insisted that they were "in process" and that he needed additional funds to keep the project movingOur inspection found that although a significant amount of work was not complete, the windows appeared to be on site so we gave him the benefit of the doubt and issued a modified Phase draw of $19,After this 6/29/draw Mr [redacted] notified us that his budget for electrical work had increased from $12,to over $30,000.00, this increase was unacceptable for two reasons: 1.) The funds in the holdback were allocated to bring the building up to a generally leasable state, shifting fund towards a higher electrical budget would short other required improvements2.) The increased electrical cost was primarily (if not entirely) related to Mr [redacted] intention to create a cannabis grow operation on the property B.) Insurance: Our loan requires that the property be properly insuredA cannabis grow operation is not an allowed use under the insurance policy (binder attached) Mr [redacted] has providedIf the property were to burn down coverage would almost certainly not be available C.) Pending Land Use Complaint and forthcoming Land Use Code Violation: There is a pending complaint with the City of Seattle regarding unpermitted use of the property as a cannabis grow operation, in talking with the City a notice of Code Violation will be issued within the next to days D.) Pending Fire Code ViolationWe cannot determine what the violation is and have asked Mr [redacted] for clarification Any one of these items would result in a limit on any draws until correction or clarification was receivedWe did issue a draw early this month in the amount of $12,for electrical work which has been completed 3.) & 4.) Complaint that WADOT is earning double interest, has lent the funds elsewhere, is operating a pyramid scheme: The reasons why draws have been limited are clearly outlined above, but in the interest of clearing all of these allegations I will address these as well: Construction Holdback funds are held in an IRETA Trust account at [redacted] ***IRETA Trust accounts (which are nearly identical to IOLTA Trust accounts used by attorneys) do not accrue interest to WADOT or its borrowers, interest accrues and is automatically paid to the Washington State Deptof LicensingThis money is held separately for the sole purpose of client holdbacksI can provide more detail on this if necessary Resolution We would like to resolve this issue, WADOT has been a member of the Revdex.com for years and made well over loans without a complaintOne of the biggest issues is Mr [redacted] insistence that we simply disburse the money to him, we are unable to do this without an understanding that the funds will be used to improve the market value of the property spending an additional $18,to upgrade electrical for cannabis use, when it appears that the City of Seattle will not allow cannabis use at this location does not make sense (and is nowhere near what the loan was approved to do) In order to move forward we will need: 1.) Proof that the property is insured and covered for its current use 2.) Clarification that the Fire Code Violation is resolved (or In our opinion resolvable) 3.) Clarification that the City Land Use Violation is resolved (or in our opinion resolvable) 4.) A revised and mutually agreed upon budget to complete the property and bring it to a state which it can generate income without violating City of Seattle Municipal Code We will work to be flexible with Mr [redacted] in resolving this, but these are significant issues that need to be addressed Thank you, Erik E [redacted] WADOT Capital Inc [redacted] Seattle, WA PH: [redacted] Fax: [redacted] ***SUPPORTING DOCUMENTS REDACTED BY Revdex.com***

Complaint: [redacted] I am rejecting this response because:I also filed a Washington Attorney General Consumer Complaint against WADOT Capital after I filed the Revdex.com complaint I feel there are possible illegal lending practices conducted by WADOT that could not be resolved by the Revdex.com The ATG is curently conducting a consumer complaint investigation.Both of you are conducting resolution for the same/similar complaint.Therefore, I will need to send you my ATG documents for your Revdex.com complaint And I will need to send your Revdex.com documents to the AG office for their complaint.Also, MrE [redacted] advised me last week he is taking (legal) action against me (defamation lawsit).This complicates it more, because instead of the Revdex.com resolution process, MrE [redacted] has jumped to legal action.Sincerely, [redacted]

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