R57 is a leader in making high-quality residential real estate investments more accessible. 

In the first quarter of 2017, according to ATTOM Data Solutions, there were 43,615 single family homes and condos flipped. A “flip” is defined as a property that sells in an arms-length transaction for the second time within 12 months. These types of transactions accounted for 6.7% of all homes sold in Q1. Across all markets, flippers averaged a $64,284 gross profit, according to ATTOM.

Buying, fixing and rehabbing a home to earn a profit is certainly a legitimate way to generate income. However, without the appropriate set of skills and training, it can also lead to big losses. What the TV shows don’t cover is that there is a far less glamorous way to invest in fix-and-flip properties that don’t require you to even leave the comfort of your bathrobe

This other way to invest has to do with another statistic in ATTOM’s report: “Flippers” borrowed an astounding $3.5B in Q1 to facilitate property acquisition and repairs. What’s not widely known is that a majority of this capital comes not from banks, but from private investors. There are a number of reasons why banks either don’t or can’t serve this market, which is where the opportunity is created for in-the-know investors.

Real Estate Crowdfunding

Historically, capital has flowed into this market from hedge funds and private equity shops via loan originators that specialize in underwriting these types of loans. While this is still the case, more and more individual investors are lending to fix-and-flippers through real estate crowdfunding platforms

There are hundreds of crowdfunding platforms including my own, and each of them presents a slightly different investment structure and offerings. Some offer debt investments, others offer equity and some offer both. Let’s talk about how my equity platform   works and how I

 create opportunities for you to invest in this growing $14 billion market in your bathrobe.

How It Works

  • The platform  source's projects from many different real estate sources through digital and boots-on-ground marketing. Our company, for example, is constantly following all market offers. 
  • Our platform has predetermined  criteria that helps to choose which projects will be selected for funding. 
  • If everything checks out, we will fund the project in full. This gives the loan a collateralized position, meaning if things go awry, the house can be liquidated to recoup the principal.
  • My platform  uses “pre-funding” to purchase projects.  This gives us an opportunity to show proof of funds in an all cash deal. Which in turn exposes us to the best deals. This is by far the the best strategy for getting deals.
  • Why It Works
  • Real estate crowdfunding became a possibility in 2012 when Congress and the SEC finalized rules around legislation called the JOBS Act. Since then, well over $1 billion has been raised online for real estate deals. Here are some of the primary reasons investors have adopted this method:
    • Access: Investors can access real estate investments on a scale not previously available to them. This extends to different geographies, asset classes, credit risks and more.
    • Diversification: With $5,000 or less minimum investment amounts, investors can spread their allocation over a variety of projects and risk/return profiles.
    • Curation: While investors should always do their own due diligence, most platforms are doing a lot of the heavy lifting related to appraisals, background checks and other reconnaissance.  
    • Crowdfunding has certainly changed the game for real estate investing. However, there are still some limitations.
      • Accredited investors only: These investments are largely limited to accredited investors. The SEC defines this as either a) someone who has $1 million of net worth, less the value of their primary residence, or b) someone who expects to earn $200,000 ($300,000 if filing jointly) per year and has done so for the last two years.
      • My fund is exempt from using only accredited investors and registering with the SEC because i'm not soliciting over the internet, I am only offering this to people I know or have spoken with.

 So let me explain in a little more detail exactly how this fund works.

 The total amount of the fund is $500,000. Let's say for instance you contributed $5,000 you would own 1% of that fund. When a house is flipped you are entitled to 1% of the investors prophet as set forth in the agreement , let's say that amount is $30,000 so you would get 1% of $30,000 which is $300.
  But if you had contributed $250,000 and owned 50% of the fund then you would get $15,000 so it's just a matter of what percent you put in to the fund.

 In most cases the project won't require  the entire amount, but you're still in for your percent. It still goes by the percent of the fund you contributed to.  

 And for your safety and 'peace of mind' you will have access to all transactional information pertaining to the account

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