Frequenty Asked Questions
What is TheWealthInvestors.com?Lets face it, funding is the lifeblood of the real estate investment business. In today's lending environment it is next to impossible for rehabers to get financing from traditional lending institutions.
TheWealthInvestors.com and the owners behind the website have 25 years of real estate rehabbing experience in cities all across the country. We act as the liaison between funding and project. Our role as 'Project Manager' on each project funded thru the website is to vet the investor and project, allocate money as needed and required, advise both investor and funding source on all areas related to the real estate and rehab process.
How does The Wealth Investors work?Our goal is to create a marketplace where real estate investors can link up with funding partners without all the hassles of the traditional lending process. We all know that a bad credit score does not necessarily mean a poor investment opportunity. And we also know that most private equity partners and lenders will not invest in projects with people they do not know. We level the playing field by offering an experienced professional group of individuals who vet each project and investor, as well as oversee the management of the project and financials, creating an opportunity to lower risk levels for our funding partners and opening the door to additional capital options for our real estate investors. We promote campaigns through our national investor network, social media and press releases.
We will select one funding partner per project.
What types of properties does The Wealth Investors website offer?At TheWealthInvestors.com we welcome all projects that are related to residential, duplex, 4-plex and 8-plex properties. We currently only support these types of projects.
Who can use TheWealthInvestors.com?The website is designed for accredited investors and experienced real estate rehabbers. Accredited Investors can invest, which means you must meet certain thresholds as defined by the Securities and Exchange Commission. As an individual investor, you must have an annual income per individual of over $200,000 per year ($300,000 per couple) with the expectation of that continuing, or a net worth of more than $1 million, excluding the value of a primary residence.
Can campaigns use TheWealthInvestors.com for equity investments?Yes. Joint Venture Partnerships is one form of investment option. There are several ways that the capital can be structured on each deal outside of a traditional loan on a property. Every transaction will involve a title company to ensure the integrity of the process and investment. Some projects will require our attorney who’s fees are an extra cost figured into the financials of each project.
Does it cost anything to create a campaign?It is completely free to create a project campaign on the website. We use a fee-based system which depends on several factors. We are paid a small percentage at the completion of each pay period (rentals) or at the completion of the financials of the project (rehab sale).
Depending on the experience level of each investor and overall time commitment required by TheWealthInvestors.com, each funded project will carry a "General Management' project fee to be paid at the conclusion of the project. This fee can range from 3% of the gross sales price up to 10% of the net profit. Projects are assessed on an individual basis to determine the final fee.
What are investment requirements?The minimum investment is $10,000. A single funding partner can contribute the entire amount requested, which typically creates a private equity situation that can become a joint venture partnership, LLC, or some balance of equity and debt structure.
Are real estate investments risky?Yes, these investments are highly speculative and investors should be able to bear the loss of a portion of their investment. Real Estate Investments are subject to market risk, including the possible loss of principal. The value of real estate can fluctuate within the framework of the industry and risks include but are not limited to sudden negative economic factors, damage to the property from vandalism or weather, unexpected repairs, seasonality, closing costs, holding expenses, and other considerations .
Investors should consider Real Estate investment objectives, risks, charges, and expenses carefully before investing. Past performance is no guarantee of future returns. TheWeakthInvestors.com performs extensive due diligence on every property and investor to the best of our ability and manages rehab processes designed to reduce certain risks described above. However, there are risks associated with real estate investing that are out of our control and should be considered prior to investing. We encourage every investor contact their attorney, accountant, and investment adviser to properly calculate the risks associated with their specific situation.
TheWealthInvestors.com performs an evaluation process that includes an assessment of the property, the location, the investor or sponsor, background and criminal checks and other vetting investigation prior to placing investment opportunities on the website. While we provide investors with relevant information including market data, borrower or sponsor information, property information and third party information, we make no recommendations about any particular investment. Each investor must do their own due diligence before making a decision to invest. We operate as General Manager of every project funded to protect our investor's interests until the project is completed.
Who oversees the investment process and financials of each project?TheWealthInvestors.com will appoint a ‘General Manger or Project Manager’ to each and every property funded thru the website in order to track, advise, and manage its progress. The owners and our partners have over 25 years of real estate rehab experience and are structured in every deal to protect the integrity of the investment process. We are paid at the completion of the project at the same time our funding partner’s receive their profit or cash flow payments. Our payment structure creates an even platform between the investor, project liaison, and funding partner incentivizing all parties to complete the deal on time and on budget. Our role is to protect the funding partner’s investment while advising the real estate investor during the rehab process.
What does it mean to be an accredited investor?Under the federal securities laws, a company or private fund may not offer or sell securities unless the transaction has been registered with the SEC or an exemption from registration is available. Certain securities offerings that are exempt from registration may only be offered to, or purchased by, persons who are accredited investors. One principal purpose of the accredited investor concept is to identify persons who can bear the economic risk of investing in these unregistered securities.
Unlike offerings registered with the SEC in which certain information is required to be disclosed, companies and private funds, such as a hedge fund or venture capital fund, engaging in these exempt offerings do not have to make prescribed disclosures to accredited investors. These offerings, sometimes referred to as private placements, involve unique risks and you should be aware that you could lose your entire investment.
The SEC recently adopted rules to permit general advertising for certain exempt offerings.
Are you an accredited investor?An accredited investor, in the context of a natural person, includes anyone who:
On the income test, the person must satisfy the thresholds for the three years consistently either alone or with a spouse, and cannot, for example, satisfy one year based on individual income and the next two years based on joint income with a spouse. The only exception is if a person is married within this period, in which case the person may satisfy the threshold on the basis of joint income for the years during which the person was married and on the basis of individual income for the other years.
In addition, entities such as banks, partnerships, corporations, nonprofits and trusts may be accredited investors. Of the entities that would be considered accredited investors and depending on your circumstances, the following may be relevant to you:
In this context, a sophisticated person means the person must have, or the company or private fund offering the securities reasonably believes that this person has, sufficient knowledge and experience in financial and business matters to evaluate the merits and risks of the prospective investment.