Real estate financing investment is an investment vehicle that allows a private investor to step into a bank's shoes and provide credit for real estate transactions (i.e., mortgage).
The level of risk in providing credit is the same as the level of risk that a bank takes on when it lends money (i.e., very low).
The credit is provided against a first-degree lien on the property title so that the investor is the first and only creditor of the property rights in the case of insolvency.
The value of the property is significantly greater than the amount of financing (usually double) so that every dollar invested becomes two dollars of real estate value.
The valuation is performed objectively, by an appraiser or broker who is not a party to the transaction.
Credit is provided in recognized areas where we manage our real estate so that in the event of insolvency we take over the property, rent it out, and sell it.
The process of registering the lien is exactly the same as the process involved in purchasing a property. It is carried out by a lawyer and insured through title insurance.
The credit is provided for the purpose of purchasing, renovating, selling, or renting the property to real estate professionals only (e.g., contractors, realtors, borrowers).
Safe investment: every dollar invested becomes two dollars worth of real estate value.
Low entry threshold, starting from only $50,000.
Net return starting from 8% per year.
Monthly income is deposited into the investor's bank account on a fixed date.
Short investment period, repayment within 12 months.
No ancillary expenses (e.g., attorney, purchase tax, brokerage, maintenance fee).
Establishment and ownership of a U.S. company is not required.
Great savings in time and energy on the part of the investor.
Flexible and convenient exit points from the investment.
Advice and planning: In an initial meeting, the investor is presented with a number of investment opportunities. The investor chooses the opportunity and the amount of investment that suits him or her best, usually starting at $50,000.
Risk management and diversification: The investor can spread the investment over a wide range of financing transactions.
Signing an agreement: An investment agreement is signed between the investor and the company. The agreement is a simple, uniform, and legible agreement that has been utilized with hundreds of investors in the past.
Signing documents: In conjunction with the signing of the agreement, a number of additional documents will be provided based on the investor's tax residency (e.g., W-8 BEN, W-8 ECI, W-9, PIE Certification).
Transfer of the investment: The amount of the investment is transferred by the investor to a trust account until it is subsequently transferred to the entrepreneur. The transfer will be made via wire directly from the investor's bank account to the trust account.
Registration of the collateral: The property is registered in the name of the investor as collateral for the full amount of the investment and to guarantee him or her complete security and peace of mind.
Monthly income: Interest payments are transferred to the investor's bank account every month until the end of the investment period. The investor receives a monthly report on the transfer of the funds.
Termination of the investment: Usually the investment periods are short, about 12 months. At the end of the period, the loan principal is transferred to the trust account and from there back to the investor's bank account.
When a new investment opportunity arises, we give priority to investors who have completed an investment with us in the past before reaching out to additional external sources, all in order to ensure as high and stable a flow as possible.
When considering an investment there are many issues that are important to understand and check out, and quite a few questions that are worth asking before reaching the right decision. Investing in general, and investing in income-producing real estate in the US, is not a trivial matter. So, to make it easier for you in the process, we have compiled some of the most common questions we encounter when we first meet our investors. In our experience, the answers you find here dispel the fog, drop the right tokens, and help investors see the benefits inherent in a smart and profitable real estate investment. If you have any further questions we invite you to click here to schedule an initial consultation without any obligation. We will be happy to put at your disposal the full knowledge we have accumulated along the way.
Excellent question. We work in complete transparency with the investor and provide all the information needed to analyze the transaction, from the due diligence to the proper and safe registration, even before you enter into the transaction and transfer one penny.
The way to look to the future is to examine the past. With a decade of successful investments, over 100 investors, and a $22 million real estate financing portfolio, we invite you to be impressed by the testimonials from our investors, who will be happy to answer any question you might have.
We are glad you raised the issue. It is important to know that we only finance transactions in areas where we own and operate our real estate so that in the event of insolvency, we can take over the collateral, rent, renovate, improve, sell and perform any action necessary that will guarantee a return on investment and maximize return. We are the first and only creditor to full rights in real estate.
In addition, the collateral is registered through a real estate lawyer (title company) who checks prior to the registration that the property is free of debts and has no liens, penalties, or levies on it.
First, it is important to note that it is strictly forbidden to guarantee investors a fixed return for real estate investments in the US market. At the same time, a real estate financing investment track provides a fixed minimum annual return of 8%, regardless of the income generated by the actual property, but according to the contract agreement with the developer who received the financing, the profit or investment fund is nil.
In the real estate financing investment track, all the associated costs apply to the borrower who receives the financing and no additional cost applies to the investor other than the conversion and administrative costs of transferring money to the trust account.
You pay taxes on the interest as if it were ordinary income — that is, at the same rate as your other income, such as wages or self-employment earnings. So, if you're in the 24% tax bracket, you'll also pay a 24% rate on your interest income.
The interest payment is withdrawn from the entrepreneur's bank account automatically and on a fixed date, just like a standing order at a bank. In case there is no coverage for the payment of interest, an alert letter is sent before initiating legal proceedings. At that point, the interest rate rises to the maximum interest rate allowed by law (for example, 18% in the state of Florida).
If the borrower does not respond to the letter of notice, our legal department files a lawsuit in court demanding the forfeiture of the collateral for the purpose of paying the interest and refunding the full amount of funding. The entire process takes several months and we bear all the costs involved in carrying out the legal process until there is full repayment of the financing fund and interest for the investment period.
There is no catch here. We work in complete transparency. What you see is what you get. The fact that these deals sound "too good to be true" does not mean that they do not exist in reality. We have developed unique methods of operation to locate such transactions and an available and systematic logistics system to maximize potential upside and returns.
The investment route in real estate financing is particularly convenient and worthwhile in comparison to a direct investment in real estate. This is because it allows for a high monthly cash flow starting from the first month, relative liquidity of the investment fund, and the full backing of real estate.
With our investors having participated in hundreds of successful real estate financing deals with a total value of more than $22 million, we invite you to be impressed by their recommendations. And of course, we will be happy to connect you with them for a direct impression call. As previously stated, what you see is what you get.