When I first got into private lending and real estate investing, I heard the phrase “You make money when you buy, not when you sell” more times than I could count. I didn’t fully grasp how true that was until I saw a few deals fall apart—not because the borrower didn’t work hard or the renovation wasn’t quality, but because the numbers were off from the start.

At Funded Capital, we see it all: fix and flip deals, ground-up construction, DSCR rental plays. And while each loan type has its own structure and strategy, one thing is always true—risk lives in the details. If you don’t take the time to properly analyze comps or fully understand the risk profile of a deal, you’re not just leaving money on the table—you’re setting the whole table on fire.

The Danger of Bad Comps

Let’s say you’re looking to flip a property and your agent or wholesaler hands you a few “comps” that look great on paper. But when you look closer, the properties are a mile away, not updated, or sold six months ago in a completely different market condition.

Bad comps are worse than no comps. They give you a false sense of confidence and can completely skew your ARV (After Repair Value). And when the ARV is inflated, everything downstream suffers:

You might overpay for the property
Underestimate renovation costs relative to resale value
Or worse—end up sitting on a finished project that won’t move because buyers see through it

We encourage every borrower we work with to dig deeper. Look at sold homes, yes—but also pending ones. Look at finishes, curb appeal, bed/bath count, school district—even the street the house sits on. Every little difference adds or subtracts from value.

Risk Isn’t Just a Line Item

In lending, we underwrite deals conservatively for a reason. We’re not here to kill deals—we’re here to protect capital and help borrowers scale responsibly. But that only works when risk is identified upfront.

Some of the biggest red flags we see?

No real contingency budget
Assuming a fast sale in a slow market
Counting on an unrealistic rental rate to cover DSCR
Underestimating permit delays or soft costs in construction

It’s not about being pessimistic—it’s about being honest. Real estate can absolutely build wealth, but only if you respect the risk as much as you chase the reward.

Our Role at Funded Capital

We do more than fund deals—we partner with investors to help them grow smart. That means running comps with a critical eye. That means asking the tough questions in underwriting. That means saying, “Hold off on this deal,” when the numbers don’t line up—because we’d rather pass on a deal than push someone into a problem.

Final Thoughts

Properly analyzing risk and comps might not be the most exciting part of real estate, but I can promise you this: it’s the most profitable. Every extra hour spent double-checking assumptions is a safeguard against regret. Every conservative estimate is a boost to your profit margin when things go well.

That’s how smart investors win. And that’s how we help them win—deal after deal.